The Middle East, broadly defined as an area stretching from North Africa to Afghanistan, presents an array of challenges to U.S. foreign policy. Although the United States maintains strong relations with several key Arab and non-Arab states such as Israel, Egypt, Saudi Arabia, Jordan, and Turkey, other state and non-state actors, such as Iran, the Lebanese Shiite group Hezbollah in Lebanon, and the Palestinian Sunni group Hamas, are aligned against U.S. interests. Hezbollah and Hamas are both U.S. State Department-designated Foreign Terrorist Organizations (FTOs) and have refused to renounce the use of violence against Israel. It is widely believed that Iran continues to seek nuclear weapons capability, a goal that, if achieved, would have serious balance of power and proliferation consequences throughout the region and globally. Some observers fear that Israel could preemptively strike Iran and thereby trigger a wider war. Iran also continues its strong ties to Syria, complicating U.S. efforts to peel that Arab state away from its predominantly Persian ally and advance a more comprehensive Israeli-Arab peace process. Although most observers agree that the image of the United States in the Middle East has improved under the Obama Administration, widespread dissatisfaction with U.S. policy in the region remains. Muslim world outreach and the Administration's decision to try to close the U.S. detention facility at Guantanamo have done little to limit the influence of state and non-state actors aligned against U.S. interests (Iran, Syria, Hezbollah, Hamas). The ongoing war in Afghanistan and the perceived failure of the United States in bringing Israel and Palestinian leadership together to advance the peace process have curbed U.S. influence in the broader Middle East. Regional actors themselves, such as Saudi Arabia, Qatar, and Turkey, have taken more responsibility for resolving disputes rather than reflexively deferring to U.S. diplomacy. In addition to these broad geopolitical realities, the Middle East continues to struggle with the effects of the global financial crisis and a range of domestic socioeconomic challenges including widespread poverty, income inequality, population growth, high unemployment, and water resource scarcity. Lack of respect for human rights and the underdeveloped state of democracy in the region are often criticized by citizens, advocacy groups, and international observers alike. The United States has continued to advocate for economic and political reform to address these challenges. General questions for congressional consideration include: If the Obama Administration continues the push for Middle East peace, how will the 112th Congress respond to Palestinian divisions, Hamas' control of the Gaza Strip, continued Israeli settlements, and various obstacles to the peace process? Given the budget constraints facing the nation, how will the United States continue to support an array of regional initiatives, such as foreign aid to key strategic partners, democracy promotion, and development assistance? Despite U.S. and international sanctions, radical regimes, such as Iran and Syria, continue to persist in pursuing policies counter to U.S. interests. What new tools, if any, may Congress employ to change their behavior? Should some existing policy tools be reinforced or adapted? To what extent does the United States remain vulnerable, at home and abroad, to terrorist attacks from Al Qaeda-inspired groups? How will policymakers balance counterterrorism strategies with diplomatic strategies for improving U.S. bilateral relationships with Arab regimes? Members of the 112 th Congress may face any number of issues in or relating to the Middle East including the war in Afghanistan, terrorism, foreign assistance, democracy promotion, human rights concerns, and ongoing effects of the global financial crisis. Unexpected challenges are also likely. Discussed below are issues of interest to members of the 111 th Congress that may receive attention in the 112 th Congress, a summary of past congressional action, and options for members of the 112 th Congress. There appears to be a growing international consensus to adopt progressively stricter economic sanctions against Iran to try to compel it to compromise on its further nuclear development. Measures adopted since mid-2010 by the United Nations Security Council, the European Union, and several countries complement the numerous U.S. laws and regulations that have long sought to slow Iran's alleged weapons of mass destruction (WMD) programs and curb its support for militant groups. The U.S. view—increasingly shared by major allies—is that sanctions should target Iran's energy sector, which provides about 80% of government revenues, and try to isolate Iran from the international financial system. U.S. efforts to curb international investment in Iran's energy sector began in 1996 with the Iran Sanctions Act (ISA), a U.S. law that mandates penalties against foreign companies that conduct certain business with Iran's energy sector. ISA represents a U.S. effort, which is now broadening, to persuade foreign firms to choose between the Iranian market and the much larger U.S. market. In the 111 th Congress, the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA, P.L. 111-195 , signed July 1, 2010) expanded ISA significantly to try to restrict Iran's ability to make or import gasoline. Iran depends on gasoline imports for about 40% of its needs. CISADA also adds a broad range of other measures that restrict access to the U.S. market for banks that conduct transactions with sanctioned Iranian entities; the already limited amount of U.S. trade with Iran; and some high technology trade with countries that allow WMD-useful technology to reach Iran. CISADA's enactment followed the June 9, 2010, adoption of U.N. Security Council Resolution 1929, which imposes a ban on sales of heavy weapons to Iran and sanctions many Iranian entities affiliated with its Revolutionary Guard. The resolution does not mandate sanctions on Iran's energy or broad financial sector but it does authorize such measures. European Union sanctions, enacted July 27, 2010, use the authorities of United Nations Resolution 1929 to prohibit EU involvement in Iran's energy sector and restrict trade financing and banking relationships with Iran, among other measures. National measures announced by Japan and South Korea in early September 2010—both are large buyers of Iranian energy—impose restrictions similar to those of the EU. Because so many major economic powers have imposed sanctions on Iran, the sanctions are, by most accounts, having a growing effect on Iran's economy even though reliable empirical data is scarce. Among other indicators, there were a stream of announcements by major international firms during 2010 that they are exiting the Iranian market. However, there is not a consensus that sanctions are causing a demonstrable shift in Iran's commitment to its nuclear program—the key strategic objective of the sanctions. Many observers believe that the 112 th Congress might consider additional Iran sanctions legislation, and possibly also measures to support Iran's domestic opposition through democracy promotion funding or other efforts. For decades, the United States and Israel have maintained strong bilateral relations based on a number of factors, including strong domestic U.S. support for Israel; shared strategic goals in the Middle East (concern over Iran, Syria, Islamic extremism); shared democratic values; and historic ties dating from U.S. support for the creation of Israel in 1948. U.S. foreign aid has been a major component in cementing and reinforcing these ties. Although there have been differences over Israel's settlements in the West Bank and Gaza Strip and Israeli arms sales to China, successive Administrations and many lawmakers have long considered Israel to be a reliable partner in the region, and U.S. aid packages for Israel have reflected this sentiment. Critics of U.S. aid policy, particularly some in the Middle East, argue that U.S. foreign aid exacerbates tensions in the region. Many Arab commentators insist that U.S. assistance to Israel indirectly causes suffering to Palestinians by supporting Israeli arms purchases. Congress has taken measures to strengthen Israel's security and maintain its "qualitative military edge" (QME) over neighboring militaries, and successive administrations have routinely affirmed the U.S. commitment to strengthening Israel's QME. In July 2010, Assistant Secretary of State for Political-Military Affairs Andrew J. Shapiro publicly reaffirmed the Obama Administration's commitment to preserving Israel's QME. He said, "We are fully committed to Israel's security because it enhances our own national security and because it helps Israel to take the steps necessary for peace." The 112 th Congress may choose to focus on U.S. aid to Israel as a way to preserve its QME. For FY2011, the Obama Administration requested $3 billion in Foreign Military Financing (FMF) to Israel. Defense appropriations for co-research and development of missile defense systems also may be an issue for the 112 th Congress. U.S.-Israeli missile defense cooperation has been authorized and appropriated in the defense authorization and appropriations bills. In FY2010, Congress appropriated over $202 million for U.S.-Israeli missile defense. In March 2010, the Obama Administration announced that it would support an additional $205 million in defense assistance to Israel for the purchase of up to 10 Iron Dome short-range missile defense batteries. Congress may act to authorize and appropriate these funds for Iron Dome. Since the founding of the State of Israel in 1948, wars between Israel and its neighbors have repeatedly spurred active U.S. diplomacy, and their resolutions have required Congress to legislate assistance for Israel and its erstwhile adversaries. Congressional aid appropriations have reinforced Israel's peace treaties with Egypt and Jordan and have helped to enable the peace process between Israel and the Palestinians to proceed, albeit with interruptions. On taking office in 2009, President Obama declared Israeli-Palestinian peace to be a U.S. national security interest because the lack of peace has affected U.S. relations with countries in the Middle East and elsewhere and provided extremists with a cause.