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Geez, that's exactly the point.
Of what? Gibson, in Passion of The Christ merely used the Gospels for all references to the Jews and their culpability in Christ's death. The film did not say that Jews drank the blood of new-born babes. But, Krauthammer in a column and others called the film a "blood libel". In its strictest sense, blood libel was the incorrect term to use to criticize the movie. However, in its hyperbolic sense (the context Palin used in her speech); it was perfectly correct (from Krauthammer's P.O.V.).
I merely mentioned the film as an example of it being used by Jews in a hyperbolic way. That is how language works. A phrase that means something specifically eventually gets used as hyperbole or exaggeration and loses its original meaning. as has been pointed out, the WSJ had already used the term in that way to describe the MSM's attacks in the wake of the shootings.