What is the reason for US not even recognizing the State of Palestine?
I would understand if it vetos resolutions that favour Palestine - but I can't comprehend why it doesn't recognize it as a separate state, yet is satisfied that the PLO represents Palestine? I am really confused about this.
The basic US position is that outlined in the 1993 Oslo accords:
Israel should withdraw militarily from the Gaza Strip and the West Bank (excluding Jerusalem.) An interim Palestinian authority should be set up, and negotiations towards a two-state solution should proceed over a five year period, ending in 1998.
Thus the recognition of an independent Palestine State was dependent on the success of the negotiations between 1993 and 1998. However these stalled. Israel failed to withdraw in full. The people rose up in the second intifada. The interim Palestinian Authority became a permanent government in the part of the West Bank that Israel had withdrawn from, while Hamas took control of Gaza. Israel has effective control of most of the West Bank. US recognition of a Palestinian state is dependent on a peace process that leads to Israeli recognition of a Palestinian state, and right now that looks very very unlikely in the short to medium term.
So the US would support a two-state solution, if one can be agreed upon. But that depends on Israel and the Palestinians.
One simple explanation is that Americans are more sympathetic to Jews than to Muslims.
For example, a 2017 Pew Research Poll which asked respondents to rate their attitudes for various religious groups on a scale from 0 to 100 gave Jews the highest average rating at 67 points (just beating Catholics at 66), and Muslims the lowest average rating at 48 points. This trend was consistent across all age groups, but weakest among age 18-29 with only a 4-point difference (62-58). Interestingly, even though 68% of Jews would vote for Biden, Jews had a slightly higher favorability rating among Republicans than among Democrats (68-66).
Gallup Polls have consistently shown higher support for Israel than for Arabs/Palestinians since 1967.
This may at least partially be a result of demographics, with the American population being 1.9% Jewish but only 0.9% Muslim. While 1.9% may be a small percentage, the US has the second-largest Jewish population in the world by absolute numbers (5.7 million, versus 6.3 million in Israel).
Also, there was a huge anti-Muslim and anti-Arab backlash resulting from the September 11, 2001 terrorist attacks. Unfortunately, I'm having trouble finding before-and-after poll numbers right now. But it's no coincidence that Biden referred to the October 7 attacks as being tantamount to “15 19/11”s, instead of say, “270 Oklahoma City bombings”. The association of Arab Muslims with 9/11 and terrorism in general is very strong in the American psyche, at least among people old enough to remember 9/11.
So, unsurprisingly, Americans view Israel much more favorably than Palestine. A view that has intensified during the 2023 war. And our politicians (with notable exceptions like Rashida Tlaib) simply reflect the public's attitude.
Mostly, domestic political reasons.
Right wing/Republicans is very pro-Israel, for a variety of reasons (the answer won't go into detail, but I think other answers on Politics.SE explained it). Short-short list of reasons are national security + christian evangelical theological influence that views what happens in Israel as important.
(Centerish) Left wing typically - at least up until 2000/2010 - was also pretty pro-Israel and dominated Democratic party till then; and even right now Democrats are split between legacy wing supporting Israel for most part, and progressive new wing opposing.
As such, NOT supporting Israel (and recognizing Palestinian state in its current form is viewed exactly as opposing Israel), is a domestic political non-started, in a fairly bipartisan way even now, never mind 20 years ago.
There's about 100000 polls to prove this, I'll randomly pick one from the top of my first Google search result:
This one from 2023 is obviously centered on Israel/Hamas war, but you can find similar polls on Palestinian-Israeli conflict for any year in the past.
[...] why it doesn't recognize it as a separate state, yet is satisfied that the PLO represents Palestine? I am really confused about this.
Hamas does care for the US recognition
For one, Gaza is ruled by Hamas, a religious liberation movement (unlike the PLO, which is a secular one), which does not even aspire to statehood in the western sense of the word. Hamas does not even accept the very principle of the negotiated settlement with Israel ("Two states for two people living in peace and security"), but demands that Israel disappear ("From the river to the sea"). Hamas does not show interest in joining to western bodies (like UN), abiding by western principles (like Geneva conventions), etc.
Weakness of the PLO
Exercising authority over its own territory is one of the core elements of being a sovereign state. Even before Hamas takeover of Gaza the Palestinian Authority was unable (or unwilling) to do so, despite the creation of a substantial police force allowed by the Oslo accords, which manifested itself as the Second Intifada . Thus, recognized as is, Palestine would readily become a failed state, being a state de jure, but not de facto:
A failed state is a state that has lost its effective ability to govern its populace. A failed state maintains legal sovereignty but experiences a breakdown in political power, law enforcement, and civil society, leading to a state of near-anarchy.
As an notorious example of state responsibility for controlling the terrorism originating from its territories one could mention the Assassination of Archduke Franz Ferdinand of Austria by members of Black Hand. While the role of the Belgrade in supporting Black hand is unclear to this day, the event served as a casus belli for the First World War.
Antagonizing Israel is a strategic loss for the US
Israel would obviously disagree, if Palestine is declared a state without having made a peace agreement with Israel. It is worth pointing out that Israel tried such unilateral moves itself when it withdrew from Gaza, leaving the Palestinians to try building statehood in the area without reaching a formal agreement - ironically, the move was much criticized by some Palestinian supporters.
The US recognition of the Palestinian state would likely lead to a rupture of the relationship between the US and Israel. The US would lose its strongest ally in the region, while Israel would lose its strongest political and financial backer. Certainly, it would be more damaging for Israel, than for the US, but not fatal - neither in economic nor in military terms. The most unpleasant likely consequence is that Israel would look for another ally - preferably a superpower with a veto right in the UN Security Council - in the best case scenario it would be the UK or France, like in the early days of Israel - in the worst case scenario it might be Russia or China.
