To visit Gaza for a third time in five years still induces a gut reaction of pity, depression and anger – pity at the hopeless, helpless plight of the Palestinians; depression about their future and, ironically, that of Israel too; and anger at the latter's cynical policies – and impunity.

I was part of a pan-European Parliamentary delegation which also enjoyed complete political access in Egypt, including meetings with its Foreign Minister and Speaker, plus the head of the Arab League. In Gaza we met the Prime Minister and cabinet colleagues, NGOs and the head of the indispensable UN mission (UNRWA).

Relations between Israel, Palestine and Egypt are grotesquely complicated and intractable. There are rights and wrongs on all sides and, indeed, mutual fears. The Mubarak establishment harbours deep anxieties about infection of the Egyptian street by the populist, faith-based Hamas. The legacy of Jewish history fosters an almost genetic insecurity, and the Gazan Palestinians live in traumatised dread of another pulverisation.

The last one, a year ago, left around 1,400 Palestinian dead (against 13 Israeli fatalities) and many thousands wounded. As we saw, their already poor infrastructure, most factories, many schools and public buildings and thousands of houses were obliterated or severely damaged. One meal was hosted for us by Palestinian MPs in their wrecked debating chamber.

Following the Gaza blitz the UN raised a $4.5bn restoration fund. Not one dollar has been spent, so vindictive is Israel's siege by land, sea and air. Bare survival is thanks to the tunnels under the Egyptian border, but they are now being blocked off. If and when that is complete further radicalisation of the Palestinians and working class Muslims elsewhere is inevitable, and with it more terrorism in the West, of which the abuse of Palestine is the greatest engine.

Gaza, then, is a ghetto of 1.5 million abandoned people – half under 18 and 80 per cent unemployed – with plenty of time to feed on their resentments. Unsurprisingly, 30 per cent want to leave their prison.

But what for me and many explodes the Israeli apologia for their conduct in Palestine, and particularly its security claims, is its relentless colonisation of the West Bank and East Jerusalem, settlers now totalling around half a million. Nothing could be as provocative, except perhaps the assault on, and siege of, Gaza conducted with the same controlled violence as characterises the occupation of the West Bank with its hundreds of humiliating and disruptive checkpoints and a pass system which outdoes that of old South Africa.

And what about the law? Israel – cradle of lawyers – is in cavalier breach of International Law, the United Nations Charter, its Conventions and Resolutions, and yet is protected from the consequences which should follow (harken to Tony Blair on defiance of UN resolutions last Friday!). Israel is now more "rogue state" than the "strategic partner" David Miliband recently labelled it.

All this is replete with tragedy and paradox. The psychic wounds of the unspeakable Holocaust are still raw and unmanageable and also sustain the collective guilt of the West, warping political judgments and norms in the process. Israel does what it wants, the latest example being their humiliating rebuff of President Obama's insistence that they stop their colonisation. The Palestinian voice is puny by comparison.

This history, which constrains so many liberal Jews in the West from speaking out on Palestine, as they otherwise surely would, is matched by the public silence of many non-Jewish critics for fear of being branded anti-Semitic – as unpleasant a tag as exists. All this has profoundly dangerous potential.

So Israel, effectively unhindered by the US or ourselves, is deluded by the "triumph" of its machiavellian diplomacy into believing that the tactics of divide and rule, obfuscation and procrastination, will forever enable it to frustrate justice for the Palestinians. Yet for Israel to defy the UN steadily undermines its own legitimacy, given the UN was its only begetter and may yet be needed as its main guarantor.

As for token Palestinian resistance, I sense they at least agree with the Jews in the lesson hard learnt by the latter, never to acquiesce in one's own oppression, whatever the odds. So Israel least of all should be surprised at the defiant trickle of Hamas rockets, against which their criminally disproportionate retribution in Gaza looked like nothing so much as the abused becoming the abuser. I returned, as usual, miserable and ever more convinced that tough love is overdue to help save the remarkable nation that is Israel from itself. The West should now look to the imposition of escalating cultural and economic sanctions. Nothing else has worked and time may be short. There will be a hullabaloo, but carrying on as heretofore would be the sin.