"We at ArabCrunch condemns this move by Facebook and call it a racist one,"
It angers me when people use the word racist completely out of place. A useful journalism practice, if your purpose is to attract the attention of as many people as possible, but a despicable one, if your focus is on telling the truth.
(Now, I agree that Palestinians and Israelis might be of different race, but the rest of the article emphasizes the religious differences between the two groups.)