Blair admits he is shocked by discrimination on the West Bank

He was the leader that made New Labour pro-Israel without informing anyone in the party that he had done so. This led him to side with Bush in failing to call for a ceasefire during Israel's bombardment of Beirut and, ultimately, to his own demise.

When, on leaving office, he was appointed Special Envoy to the Middle East; there were many who scoffed at the notion that this man, of all people, would be fair towards the Palestinians; having already shown such bias towards the Israelis.

But now, he's on the ground in Palestine, and all reports are that he's utterly shocked at what he's seeing.

While his aides munched tuna bagels thoughtfully provided by the Israeli military, a shirt-sleeved Tony Blair peered intently at a map showing the two main cargo crossing-points that will function between the West Bank and Israel once the 450-mile separation barrier between them is complete.

Why, Mr Blair wanted to know from his host, an Israeli general in civvies, couldn't goods also be moved directly across the border from the nearby Palestinian industrial park that he is pressing Israel to approve?

"Why can't they go straight through?" Ah, that would be difficult, the general explained, requiring a whole new expensive security apparatus to check goods going into the park.

His tour is taking him all over the West Bank and he has recently been in discussion with Khaled Osaily, the mayor of Hebron, a city which was once the thriving commercial hub of the southern West Bank, now mostly boarded up because of the presence of 800 Israeli settlers and their military protectors.

He was shocked by what he was told about conditions in Hebron and diplomats say he was genuinely taken aback by his trip to the West Bank sector of the Jordan Valley – where Palestinians are allowed to dig wells only a third as deep as Israelis – at the exploitation of resources by the rich Jewish agricultural settlements at the expense of closed in Palestinian farmers. And he has been privately dismissive – rather more so perhaps than he was as Prime Minister – of the argument by some Israelis that security comes first, with economics and a political deal well behind it. "All three have to happen together" he has told diplomats – which is what he sees Annapolis as being about.

And so the Labour leader, schooled in the Israeli-Palestine conflict by Lord Levy, finally gets to see the reality on the ground.

And it is very different from the image that he was sold by Levy:

Some of the possible contours are beginning to clarify: a land swap to preserve the big West Bank Jewish settlements and, possibly, Israeli agreement in principle to East Jerusalem as a future Palestinian capital.

But the obstacles could hardly be more potentially terminal. Mr Abbas, at least as much as Mr Olmert, will have to make concessions without yet having a final deal in return. And this at a time when a totally excluded Hamas will have every opportunity to sabotage any process.

Yet none of this seems to dent Mr Blair's almost heroic optimism that it is "do-able." He accepts in private that settlement expansion will soon make a Palestinian state unrealisable, increasing the urgency of a solution. But he is said to believe that Mr Olmert sees a two-state solution as necessary in Israel's interests and accepts time is short.

He thinks the similarities with Northern Ireland are as great as the differences but since it irritates Israelis for him to say so, he doesn't. But that doesn't stop him recalling how Ian Paisley told him early in his premiership there would never be an agreement in Northern Ireland.

I have always thought that Blair's pro-Israeli stance was more about political convenience, and being fed Hasbara by Levy, than it was about any practical understanding of the sheer scale of the injustice being perpetrated on the Palestinians.

Now, he's on the ground and seeing it for himself. I am glad that he is shocked. And I am glad that he also appears to understand that Israeli expansionism will soon make a two state solution impossible. For Israel's sake as much as the Palestinians.

For once the two state solution becomes impossible to implement, we are left with a one state solution, and the demographics inherent in that solution do not bode well for any Jewish state.

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Tags: Blair, Israel, Palestine, Annapolis conference, Hebron, injustice