President Donald Trump has threatened to cut off financial support to the Palestinian Authority (PA) as the fallout from his administration’s decision to recognize Jerusalem (an occupied city under international law) as the capital of Israel continues to reverberate across the Muslim world. Following an overwhelming December 2017 UN vote to condemn the Jerusalem move, a resolution originally introduced by the Palestinians, US officials have been weighing ways to retaliate. The U.S. had already said it would move its embassy to Jerusalem regardless of the UN vote. But the Trump administration has been open about the fact that it would punish anyone who opposed the move, and would reward those states prepared to get behind its logic that the Israeli government would be more likely to offer concessions if the issue of Jerusalem were taken off the table in the peace process. In addition, Trump has threatened to cut funding to UNRWA, the UN agency that supports Palestinian refugees, as well as the PA itself, in a move that risks further marginalizing the US government from the Israeli-Palestinian peace process. But is the threat actually credible?

Background

The actions being considered are in fact far less dramatic than the media headlines would suggest. Security assistance, which helps the PA coordinate police cooperation with Israel, is excluded, as is assistance to UNRWA and the PA, which supports Palestinian children in Gaza, Jordan, and Lebanon. The Trump team is instead considering how to direct more US funds away from both organizations and toward non-government groups (working on issues like fighting corruption or health and education projects). These groups already receive the bulk of US financial assistance.