I can't think of any other situation where a group would be able to consider criticism of the actions of a sovereign state as an offence against themselves. Should the same courtesy be extended to Saudis, Chinese or Americans? Why not let little Englanders take offence if someone says the UK is racist.
The absolutely absurd thing is that Israel is racist. It's undeniable and it has been constant from it's inception until today.
From yesterday's Guardian in an article by the Israeli and Jewish composer Daniel Barenboim
"Instead, we have a law that confirms the Arab population as second-class citizens. It follows that this is a very clear form of apartheid. I don’t think the Jewish people lived for 20 centuries, mostly through persecution and enduring endless cruelties, in order to become the oppressors, inflicting cruelty on others. This new law does exactly that. Therefore, I am ashamed of being an Israeli today. "
From a 1948 letter condemning the first version of Likud by Hannah Arendt, Albert Einstein and other prominent Jewish intellectuals
"Among the most disturbing political phenomena of our times is the emergence in the newly created state of Israel of the "Freedom Party" (Tnuat Haherut), a political party closely akin in its organization, methods, political philosophy and social appeal to the Nazi and Fascist parties. It was formed out of the membership and following of the former Irgun Zvai Leumi, a terrorist, right-wing, chauvinist organization in Palestine."
"The undersigned therefore take this means of publicly presenting a few salient facts concerning Begin and his party; and of urging all concerned not to support this latest manifestation of fascism. "
http://www.thehypertexts.com/Albert Einstein 1948 Letter New York Times Nakba.htm