Today's miserable standoff in the Middle East requires new initiatives. The short-term failure of Israeli policies has concentrated global attention on their blockade of Gaza rather than on Iran's pursuit of nuclear weapons. The long-term failure has rendered increasingly difficult a two-state solution as Palestine is broken up into barriered Bantustans.

As President Obama's military commanders have told him, the absence of anything resembling a peace process in the Middle East, and the identification of Washington with a very rightwing Israeli government, has made it more difficult for the US to deal with Iran, Iraq, Afghanistan, Pakistan and others.

If politics does not succeed, then humanitarian aid will continue to be necessary. Yet we should never depend on the provision of humanitarian relief as an excuse for diplomatic drift and the failure to confront intransigence. Organisations such as Medical Aid for Palestinians do not exist so that others can duck their moral and political responsibilities.

The EU has a role to play to break this logjam. It is Israel's biggest trade partner and the largest provider of development assistance to Palestine, yet it has been content to play a quiet third fiddle to the US. There have been exceptions. In 1980, the EU heads of government and foreign ministers agreed the Venice declaration, which noted that "traditional ties and common interests" obliged them to play "a special role ... to work in a more concrete way towards peace". They spelled out their commitment to the right to existence and security of all the states in the region, including Israel, and "justice for all the peoples, which implies recognition of the legitimate rights of the Palestinian people". They denounced settlement activity as illegal, refused to accept any unilateral initiative to change the status of Jerusalem, urged a just solution to the problem of Palestinian refugees, and supported a comprehensive peace settlement sustained by a decision of the UN security council.

However, the EU has too often since taken the view that only Washington really drives things forward. Yet what should the EU do when American policy is going nowhere? Not surprisingly, the secretary-general of the Arab League called the so-called quartet (the EU, US, UN and Russia), which supervised the non-implementation of the road map for peace, "the quartet sans trois".

It is true that the US has the primary external role in the region, and that any peace settlement will require Israel's willing agreement. But none of this justifies the EU's nervous self-effacement. This removes much of the political price the US should pay when it does nothing or too little. It gives Israel carte blanche. It damages Europe's relationship with its alleged partners in the Union for the Mediterranean, and makes Europe complicit in outrageous and illegal acts.

It is not only Israel that has believed collective punishment of the people of Gaza since 2007 would weaken Hamas. Failure to take more decisive action to end a policy described by the International Crisis Group as "morally appalling and politically self-defeating" has spread responsibility for that policy. We must all hope Obama's meeting on Wednesday with Mahmoud Abbas and the announcement of additional US aid for Gaza signals a change of approach.

Today, the EU should not only call for an immediate end to the Gaza blockade but should work harder to promote reconciliation between the splintered Palestinian body-politic. The UN should be tasked with preventing the flow of weapons while the EU should take the initiative with Turkey and the Arab League to re-establish a government of national unity involving Fatah and Hamas for the whole of the Palestinian territory. In due course, the EU should monitor free elections there. You cannot favour democracy everywhere except in Palestine.

Without Hamas there will not be a peace settlement. What we should require from Hamas is simple – a ceasefire, acceptance of the outcome of a peace process provided it is endorsed in a Palestinian referendum, and help in securing the release of Corporal Shalit. To insist that they accept all past agreements is bizarre when no such requirement is made of Israel. Look, for example, at settlement building.

We should go further. There has been speculation the US may consider unilaterally tabling an agreement with a timetable for achieving it. Opponents of this proposal have questioned whether it would be wise for the US to thus risk its prestige. The EU could work with Turkey and the Arab League to draft proposals for an agreement to be tabled in the UN security council. This may not be immediately acceptable to the US but would at least bring some momentum.

The present situation is awful for the Palestinians, denied a decent life in their own country, bad for Israel and its prospects for a peaceful future and wretched for relations between the US and EU on the one hand and the Islamic world on the other. It is time for Europe to go back to what it said 30 years ago and act with real rather than rhetorical courage.