Yamaha rider was taken out by Bautista at the first corner of the Assen race when the latter braked too late while trying to make up places and lost control of his Gresini Honda, before slamming into Lorenzo.
MotoGP race direction decreed that Bautista was "irresponsible" and gave him the penalty of starting last for next weekend's German Grand Prix.
But Lorenzo believes that is an insufficient deterrent and wants to see Bautista banned for one race, as Lorenzo was after a clash with Alex de Angelis in the 2005 Motegi 250cc race.
"I think it's a complete disaster. It's a disaster for me," Lorenzo told the official MotoGP website. "It's not a good feeling because he's a Spaniard like me and it happened with him.
"The move he did was a disaster, but the decision that race direction is taking is even more sad. Every time it does not penalise riders so they can learn in the future. Starting the next race in last position is not enough to learn from.
"When I made a mistake in Japan in 2005, I was suspended for one race. John Hopkins had the same in Japan in another year [in 2003]. And for [Bautista] to only start in last position in the next race is not fair.
"We hope we'll be lucky in the future and that nothing will happen. But if we don't penalise the riders, they're going to do crazy things like Alvaro did today."
The engine in Lorenzo's Yamaha, which was only fitted on the Friday of the Assen weekend, was damaged in the crash, but the former champion expects to get dispensation to use an additional power unit to replace it.
"Race direction told me that they will give me another engine," he said. "I want to thank them for this decision, but the decision with Alvaro is not fair."
With Lorenzo retiring and Casey Stoner winning, the Australian is now equal on points with Lorenzo at the head of the standings, although with four wins to his rival's three, the Yamaha man still leads on countback.
"Luckily for us we had 25 points of advantage," said Lorenzo. "It was good, because if not we'd be very far behind now, but we are on zero points gap with Casey."
Although the crash was a violent one, Lorenzo was unhurt.
"It's a just a big bruise," he said. "It was just a big impact but nothing serious happened."