I have always thought that it was an anomaly that the PLO had an official office in Washington DC. After all, it has always been a declared terrorist organization dedicated to murdering Jews (whether Israelis or not) and whatever they say, they have not actually changed their charter dedicating them to the destruction of the State of Israel. Also, there is no office of any other terrorist groups, such as Hezbollah, Al Qaeda, or IS, so why should the PLO he accepted? Therefore it seemed anomalous for the US to recognize them by allowing them to have an office in DC. Of course, the culprits were Pres. Carter and Clinton, who believed you could engage with the PLO as an equal with Israel. As Pres. Trump is finding, their intransigence and rejectionism prevents even the minimal negotiations.
In order to persuade them that it is in their interests to actually come to the table, Trump has cut their funding (by m$300) and cut the US contribution to UNRWA (by m$360) and now he has decided to close their office in DC. Trump believes that economics is the basis of politics (in that respect he agrees with Marx), and he believes that he can bully/persuade the Russians, the N. Koreans, the Chinese and the PLO/PA to come to terms with him or at least negotiate.
This new policy was announced by Trump’s foreign policy adviser John Bolton. You can be sure that Bolton had a hand in advising the Pres that this was a good move. Not only as I have said is the PLO office an anomaly, but in the past and even more so under Trump, the PLO/PA has become increasingly stridently anti-American and the US is under no obligation to accept a diplomatic office of a non-state entity in DC.
Further, the PA under Pres Abbas is doing all it can to defame Israel before many international agencies. This is contrary to US policy and also puts the US and other countries in danger, since their military could also be accused of “war crimes” if a precedent is set, for example at the International Criminal Court (ICC) where the PA is pushing to have Israeli military officers labelled as war criminals. This is ridiculous, that a terrorist organization that kills civilians should be trying to get the officers of a disciplined army such as the IDF labelled as war criminals. It boggles the mind, and indeed the US has now officially warned the ICC not to give in to the PLO’s ridiculous pressure.