Most of Palin's message is banal and unobjectionable, although it's odd to hear Palin call for "common ground" having previously suggested that criticism of her threatens her First Amendment rights. Conservative blogger Glenn Reynolds employed the term earlier this week. Its use couldn't be less appropriate, particularly since she goes on to reverse the accusation and imply her critics might bear responsibility for inciting violence.
Blood libel is a term that usually refers to an ancient falsehood that Jews use the blood of Christian children in religious rituals. For hundreds of years, particularly during the Middle Ages, it was used to justify the slaughter of Jews in the street and their expulsion from entire countries. "Blood libel" is not wrongfully assigning guilt to an individual for murder, but rather assigning guilt collectively to an entire group of people and then using it to justify violence against them.
This is a new low for Palin, but outsize comparisons of partisan political conflict to instances of terrible historical oppression is a fairly frequent rhetorical device among conservative media figures. Early in the Obama administration, Rush Limbaugh said D.C. was like "the Old South" for Republicans, who were an "oppressed minority." Following the news that the Department of Justice was reviewing the outcome of the case of a white cop who had shot an unarmed black man in San Francisco, Glenn Beck told his audience that, "We have turned this into the 1950s overnight, except the races are reversed."
Given that people like Beck and Limbaugh have spent the last two years trying to convince their audiences that being white and conservative in America today is comparable to being black under Jim Crow, Palin's use of "blood libel" isn't entirely surprising.
http://voices.washingtonpost.com/plum-line/2011/01/the_foolishness_of_the_blood_l.html