The State Department is considering supporting the Palestinian Authority in its quest to avoid paying hundreds of millions of dollars in judgments won by American victims of Palestinian terrorist attacks in Israel, according to Palestinian officials and defense lawyers involved in the cases.
U.S. officials insist that no decision has been made regarding the complex litigation, which could force the Bush administration to choose between supporting compensation for victims of terrorism and bolstering the Palestinian government as the United States presses for a breakthrough in Israeli-Palestinian peace talks.
Testimony in Israeli courts has connected senior Palestinian leaders -- such as the late Yasser Arafat -- to specific terrorist attacks involved in the lawsuits. But Palestinian officials have argued that it makes no sense for the United States to be providing millions of dollars in aid to the Palestinian Authority while U.S. courts are threatening to bankrupt it.
In response to a plea for assistance from Palestinian President Mahmoud Abbas, Secretary of State Condoleezza Rice 13 months ago sidestepped the issue, writing that "the United States is not party to these enforcement proceedings." But in December, a U.S. federal judge asked the government whether it would get involved, creating the current dilemma for the administration.