U.S. Raises Pressure on Israel Over Palestinians: By Joe Lauria ,Carol E. Lee. Joshua Mitnick

http://www.wsj.com/articles/israel-to-release-frozen-palestinian-tax-funds-1427472744?mod=trending_now_4

White House leaves open the possibility of letting the United Nations set a deadline for a Palestinian state

The U.S. exerted new pressure against Israel by leaving open the possibility of letting the United Nations set a deadline for a Palestinian state, in what would be a departure from using American veto power to protect its close Mideast ally.

The prospect of a U.N. Security Council resolution arose Friday when French Foreign Minister Laurent Fabius said Paris would introduce a measure setting a deadline for a negotiated settlement of the conflict and the establishment of a Palestinian state alongside Israel, possibly within two years.

On dozens of occasions in recent decades, the U.S. has lobbied against approval of such resolutions, using its veto authority as a permanent member of the Security Council as a last resort. In response to past resolutions concerning the Middle East, the White House has echoed Israel’s contention that U.N. action cannot substitute for direct negotiations.

But the White House took a markedly different tack on Friday. Press secretary Josh Earnest said the Obama administration was aware of Mr. Fabius’s comments. “But we have not yet actually seen a text of a resolution so I’d reserve comment on a hypothetical resolution,” he said.

While he didn’t indicate whether the U.S. would actively favor such a resolution, the absence of any dissuasion was telling. White House officials didn’t elaborate on the Obama administration’s position.

As the United States pushes for a nuclear agreement with Iran WSJ national security reporter Adam Entous explains the reaction from Israel and what the country is trying to do to stop it. Photo: AP

If the U.S. were to abstain from voting on the resolution it could still pass if it gained the required nine-vote majority, further isolating Israel and fanning international criticism against it.

The adoption of such a resolution wouldn’t be expected to have an immediate impact on Israeli policy but would add to the mounting pressure.

How the U.S. might handle a new resolution on the matter in the wake of the Obama administration’s unprecedented public break with Israeli Prime Minister Benjamin Netanyahu has been a matter of intense speculation at the U.N. Mr. Fabius told reporters before addressing a Security Council meeting that he had no idea how the U.S. would vote.

“I hope that the partners who were reluctant will not be reluctant anymore,” Mr. Fabius said. He said there was “no other solution” but a new resolution.

The White House stance is in keeping with developments that have unfolded over the past two weeks. Following Mr. Netanyahu’s election eve statement this month that he no longer supported a two-state solution to the conflict, Obama administration officials said they would reassess the diplomatic cover Israel has enjoyed for decades from Washington at the U.N.

Two days after the March 17 Israeli election, Mr. Earnest said that a two-state solution backed by both Israelis and Palestinians was always considered the best outcome. “Now our ally in these talks has said that they are no longer committed to that solution,” he said on March 19. “That means we need to re-evaluate our position in this matter, and that is what we will do moving forward.”

President Barack Obama has rejected attempts by Mr. Netanyahu to reverse his position by saying he still favors two states.

There was no immediate reaction in Israel to Mr. Fabius’s proposal or the U.S. reaction, which signified new international trouble for Mr. Netanyahu.

However, Israel responded to weeks of international criticism on Friday by agreeing to lift a freeze on Palestinian tax revenue.

Israel had withheld hundreds of millions of dollars to the Palestinian Authority as punishment for the Palestinians joining the International Criminal Court. The U.N. allowing the Palestinians join the ICC is part of the shifting diplomatic landscape moving against Israel in its conflict with the Palestinians.

The U.N. General Assembly in 2012 voted to make Palestine a nonmember observer state. That designation allowed the Palestinians to join the ICC, and more than 20 other international treaties.

With peace negotiations mothballed, the Palestinian leadership has been trying to pressure Israel by seeking to pass resolutions on statehood at the U.N., join international treaty organizations, and threaten war crimes suits at the ICC.

On April 1, the Palestinians formally become a member of the court and can press charges against Israel on last summer’s Gaza conflict and on the occupation of Palestinian land. The ICC prosecutor has already announced that she would be conducting a preliminary investigation into the latest Gaza conflict.

Mr. Netanyahu’s office said the decision to unfreeze the funds was made at the recommendation of Israel’s security establishment and reflected “humanitarian considerations” and “the broad view of Israel’s interests at this time.”

It said that Israel would deduct money owed by Palestinian authorities to Israeli hospitals and the government run electric utility.

“They shouldn’t have done it in the first place, and this is wreaking havoc in our lives,’’ said Hanan Ashrawi, a senior member of the Palestine Liberation Organization, said of the Israeli freeze. “They use things as a form of pressure and political blackmail. Every time we have a hit like that the economy needs a boost to get back to normal.”

The Obama administration, which has criticized the Israeli freeze, said it welcomed the move to transfer the funds. However, the White House reaction to the possible U.N. action showed the Obama administration remains angry with Mr. Netanyahu’s government.

Successive Democratic and Republican administrations have vetoed Security Council resolutions critical of Israel. The Obama administration vetoed a Security Council resolution in 2011 that declared Israeli settlements in the West Bank illegal, even though the U.S. formally opposes such settlements.

France was working on a Palestinian statehood resolution in December when the Palestinians presented their own draft to the Security Council. It didn’t get enough votes and was defeated.

France voted in favor of the Palestinian draft, angering Israel. But since the measure fell one vote shy of the required nine-vote majority, the U.S. didn’t have to employ its promised veto to kill it.

A French official said it was unclear whether Paris plans to push for a new resolution or simply revise the resolution it drafted in December. That document, the official said, was drafted with informal input from the U.S. and other countries.

Riyad Mansour, the Palestinian representative to the U.N., said this week the Palestinians might also reintroduce their draft resolution for a vote, but he didn’t say when. The Palestinian draft is similar to France’s but sets a one-year deadline, rather than two, and calls for an international peacekeeping presence.

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