I quote extensively from an article in UN Dispatch by Mark Leon Goldberg:
UNESCO member states are poised to admit Palestine as the newest member of the UN body. This is an achievement for the Palestinian leadership, which is seeking admission to various UN agencies, but potentially catastrophic news for UNESCO and American leadership at the UN. And through no fault of her own, even Beyonce may suffer.
At issue here are two strict laws passed by the United States congress in 1994 which stipulate that “the United States shall not make any voluntary or assessed contribution to any affiliated organization of the United Nations which grants full membership as a state to any organization or group that does not have the internationally recognized attributes of statehood.” And if that were not clear enough, a second clause clearly states that the United States may not “provide funds [to] the United Nations or any specialized agency thereof which accords the Palestine Liberation Organization the same standing as member states.” The law authorizes no “waiver authority” by the executive branch, meaning that there is no way for President Obama to end run around this prohibition.
In other words, if UNESCO admits Palestine as a member, the United States will be forced to effectively withdraw from the organization. That would be a huge financial blow to UNESCO, which receives 22% of its budget ($80 million) in dues payments from the United States. With that money, UNESCO promotes world press freedom, is the lead UN agency for the implementation of the Millennium Development Goal number 2 (universal primary eduction) and administers the World Heritage site program, among other things.
But the effect would be felt far beyond UNESCO. Several smaller UN agencies — including World Intellectual Property Organization, the United Nations Industrial Development Organization and the UN Conference on Trade and Development — tie their own membership to other UN agencies. This means that when one UN agency accepts a new member, these three UN agencies automatically accept the new member as well. Once UNESCO admits Palestine, these other UN agencies will automatically admit Palestine as well…and the United States will be forced to automatically pull out.