A Reuters dispatch reports the Obama administration is “scrambling” to keep aid flowing to the Palestinian Authority, in the face of congressional holds on about $200 million in economic assistance to the PA. State Department spokesperson Victoria Nuland said yesterday the administration is in “intensive consultations” with Congress seeking to have the money released.

The administration seems bent on demonstrating there are no practical consequences for the repeated Palestinian attempts to have the UN determine final status issues that are supposed to be negotiated with Israel. Earlier this year, President Obama warned the PA there would be consequences if it proceeded with its UN settlements resolution. The PA proceeded anyway, and suffered no consequences. The PA is proceeding with its latest UN petition – and the administration is now actively trying to prevent any consequences.

During the past year, as the Palestinians have been refusing to negotiate, the administration has nevertheless (1) presented a vision of a Palestinian state by September, (2) upgraded the PLO office in Washington to the equivalent of an embassy, and (3) reacted mildly to the PA “reconciliation” agreement with Hamas, suggesting only that it raised questions for Israel.

The hold on PA funds needs to be viewed in light of the bipartisan message the House Foreign Affairs Committee sent during its September 14 hearing on Palestinian aid. At that hearing, Howard Berman (D-CA), the ranking member on the committee and the most prestigious House Democrat on foreign policy, said the Palestinian UN action ran counter “to repeated U.S. requests and to prior Palestinian commitments” and that “hundreds of millions of dollars in annual assistance … will likely be terminated” if the Palestinians pursued that course. More importantly, Berman personally endorsed an aid cutoff if the Palestinians proceeded:

President Abbas’ Palestinian Authority should not be rewarded with American taxpayer dollars for actions that defy Palestinian commitments, threaten to destabilize the region, and run counter to U.S. interests. Those dollars can be better spent elsewhere.

Berman quoted House Resolution 268, passed two months before, which promised “serious implications” for Palestinian assistance programs if the PA pursued unilateral statehood recognition. Rep. Elliot Engel (D-NY) said he was not prepared “to send one more red cent” to the PA if they could not prove they were serious about peace with Israel. Rep. Steve Chabot (R-OH) said the approaching moment was a “watershed moment in U.S.-Palestinian relations.” Rep. Ted Poe (R-TX) had the following colloquy with Elliott Abrams:

POE: Is there something we can do to be proactive, rather than reactive, about this situation? The United States of America. What should we do now?

ABRAMS: I think this hearing is important, because they’re listening. They’re listening to this and they are hearing all of you say if they go ahead with the resolution, and particularly with the resolution that has terrible content, that you’re going to cut them off.

The Palestinians listened, they heard, and they went ahead anyway, just like last time … and the Obama administration is scrambling to protect them from the promised consequences. Smart diplomacy.