It is more appeasement of ourselves then appeasement of the Palestinians let
alone being meant to "aid foreigners" as Foreign Aid naturally should do. It
is kind of like giving a buck to a begger even though you are sure he will spend
it on drink and be no better off. It's real purpose is to make you feel good. But saying that
really does no good-even if they know that, most Westerners do want to feel good about themselves.

The real problem is that all the money goes to the PA and it spends it on keeping itself in power. Which
necessarily includes terrorism as that is the PA's self-justification.
One might argue that Foreign Aid is just stringing them along with false hopes and is in some ways less merciful in the long run.  However no one has proposed a substitute except just ignoring them, which may indeed be the trend. Sometimes people have to want to be helped.