The United States House of Representatives confirmed October 5, 2011, that it is blocking $200 million in aid disbursements to the Palestinian Authority (PA) while it investigates the PA's use of that money. That investigation means Congress is making good on its threat to cut Palestinian aid if Palestine sought member status in the U.N. Meanwhile, the White House is scrambling to remove the Congressional obstacle.

The freeze impedes an American five-year, $358 million "infrastructure needs program" to help Palestinians in the West Bank and Gaza prepare for a future Palestinian state. It effects future disbursements, not money already in the pipeline to Palestine.

As early as August 2011, both the U.S. House of Representatives and Senate threatened to suspend foreign aid allocations if the PA requested member status in the U.N. Palestinian President Mahmoud Abbas made that petition on September 23, 2011. It is pending a vote by the U.N. Security Council. The United States has vowed to veto that request, charging it circumvents direct negotiations with Israel.

Palestine hopes that full member status in the United Nations will give it leverage as it seeks a permanent physical state with recognized borders in the Middle East. Palestinians have been without a true physical state since the creation of Israel in 1948.

Recent U.S. aid to Palestine

Since 1994, Palestinians have received more than $3.3 billion in aid from the United States.

That aid, administered through USAID, includes assistance in economic growth, education, water resources and infrastructures, building a democratic government, and health and humanitarian assistance.

One of USAID's objectives for Palestinians is helping them "realize a two-state solution with Israel -- living side by side in peace." Among current USAID projects in Palestine is the Dura Cluster Water Storage and Distribution System in Al Dahiriya, Hebron Governorate.

USAID reports the $13 million project will decrease the cost of water and increase water storage capacity for more than 46,000 people in a region of the southern West Bank. "The project supports the Palestinian Authority's efforts to develop West Bank infrastructure and is planned to be completed by July 2012," USAID reports. USAID and the Palestinian Authority launched the project in May 2011.

USAID has helped repair 152 miles (245 kilometers) of roads in the West Bank and Gaza, built seven schools, and completed 12 other water projects. USAID says such projects are "required for a functioning future Palestinian state."

White House Counters Aid Freeze

The freeze of Palestinian aid could turn into a permanent suspension if Congress continues its punitive measures. However, the White House is negotiating to keep money flowing to Palestine.

"We are continuing intensive consultations with the Congress on this money because we feel that U.S. support for Palestinian institution-building is a vital piece of what we're trying to do here," said U.S. State Department spokesperson Victoria Nuland.

"We're trying to prepare the ground for a successful and stable peace," said Nuland. "This money goes to establishing and strengthening the institutions of a future Palestinian state, building a more democratic and stable and secure region. We think it is money that is not only in the interest of the Palestinians; it's in U.S. interest and it's also in Israeli interest, and we would like to see it go forward."

Congress Also Threatens UNESCO

Because the pending U.S. veto of Palestine's U.N. statehood would appear to make that request a dead issue, Palestine is also shopping around to other U.N. entities for their statehood membership in their ranks. On October 4, 2011, the P.A. also petitioned the United Nations Educational, Scientific, and Cultural Organization (UNESCO) for member status.

Nevertheless, Congress has threatened to pull funding to any United Nations entity that extends membership status to Palestine.

U.S. Rep. Ileana Ros-Lehtinen (R-FL), chairman of the House Foreign Affairs Committee, said, "Feeling that their efforts at the UN Security Council will fail, the Palestinian leadership is shopping around the UN system for recognition. This attempt to rig the process needs to be stopped dead in its tracks. Our contributions are our strongest leverage at the UN, and should be used to stand up for our interests and allies."

She continued, "It is deeply disappointing to see UNESCO . . . poised to support this dangerous Palestinian scheme. The U.S. must strongly oppose this move and make clear that any decision to upgrade the Palestinian mission's status by UNESCO or any other UN entity will lead to a cutoff of U.S. funds to that entity. "

UNESCO currently gets 22% of its yearly funding from the United States.

U.S. Rep Kay Granger (R-TX), chairwoman of the House Appropriations Subcommittee on State and Foreign Operations, had strong words for Palestine's UNESCO gambit. "Making a move in another U.N. agency will not only jeopardize our relationship with the Palestinians, it will jeopardize our contributions to the United Nations," she said. "I will advocate for all funding to be cut off. . . . There are consequences for short-cutting the process, not only for the Palestinians, but for our longstanding relationship with the United Nations."