We’ve all done it. We walk down the street and see a homeless guy asking for some small change and we stride straight past avoiding his eye. Or we read about children in Syria being maimed and tortured and quickly flick over the page without a second of thought, continuing to munch on our toast.

These kinds of empathy failures are pretty normal. Although the neuroscientists now tell us that 98% of people have the ability to empathise, the reality is that we lead busy, stressful lives, and often feel we don’t have the time or energy to step into other people’s shoes, look at the world from their perspective – and give them some support. In other words, we fail to bring our neural circuitry to life, so our empathic potential lies dormant.

But something more serious is going on: Australia, the lucky country, is losing its empathy. A recent report based on a national survey by the Scanlon Foundation highlights some powerful statistics:

Racial and religious discrimination is on the rise and at its highest level since surveys began in 2007 – 40% of people born in Asian countries such as India and Malaysia have experienced discrimination over the past 12 months

There is growing anti-asylum seeker sentiment, especially against “boat people” – in 2011 23% of those surveyed thought people arriving in boats should be sent back, a figure that has risen to 33%

The majority of Australians now think their fellow citizens can’t be trusted – social trust declined from 52% in 2012 to 45% in 2013.

What are figures like these telling us? Without anyone really noticing, communities are fracturing and social cohesion being eroded. More and more people are caught up in a culture of hyper-individualism where the question “what’s in it for me?” dominates their minds. They are turning their backs on socially marginalised groups such as asylum seekers and becoming less willing to trust others, or listen to the views of people whose beliefs differ from their own – whether it’s on issues such as climate change or private schools. The big picture is clear: there’s a growing empathy deficit that is creating new levels of social division.

In some ways these attitudes are surprising. You might expect them in a country that is suffering chronic economic recession, where people scapegoat immigrants and blame them for their economic woes. But Australia hardly qualifies on these grounds, having done better than most countries to survive the repercussions of the global financial meltdown in 2008.

It’s also a little strange for a nation that prides itself on its multiculturalism (of which I am a product, with a mixed heritage including Polish, Croatian, Romanian and Scottish). In fact, 84% of respondents in the Scanlon study said they thought multiculturalism had been good for the country, and 70% believed it benefited the nation economically.

On the other hand, it’s clear the prevalent political culture is hardly conducive to creating empathy, even if the past decade has seen growing recognition of the perspectives and rights of Indigenous Australians. Just think how much stereotyping remains a staple of the contemporary political scene. Politicians from across the spectrum frequently refer to asylum seekers as “illegals” – Tony Abbott’s government decreed that they should be described as such in all official correspondence – despite the Refugee Council of Australia and the United Nations pointing out that it is an inaccurate term since there is nothing illegal about seeking asylum.

“If you wanted to disenfranchise refugees, and leave the public thinking they have no rights, then call them ‘illegal’ over and over again,” the former Paul Keating speechwriter Don Watson told me. Politicians, he says, do everything they can to “keep any kind of empathy at bay”, finding language that “dulls the instinct to ask ‘What if that were me and my children in one of those boats, or in one of those detention centres?’” Thomas Keneally – author of the empathic bestseller Schindler’s Ark – has made similar remarks, commenting on the “racial hysteria” politicians have whipped up against asylum seekers.

It is this kind of stereotyping, where we fail to see the real individuals behind the labels we impose on them, that is at the root of the empathy crisis.

This empathy decline is not, however, Australia’s alone. Across the western world there is evidence of a growing empathy deficit. A study at the University of Michigan revealed empathy levels in the United States have dropped 48% over the past 40 years, with the steepest fall happening over the last decade. This means that fewer and fewer people are making the effort to extend their moral concern towards strangers, or to take into account the feelings and perspectives of others. In the UK, the empathy deficit is reflected in a chronic decline of social trust. In 1959 60% of people thought most other people could be trusted. That figure has now halved. A creeping, self-centred individualism has become dominant in public culture.

It all sounds a bit depressing. But there’s good news. There is a quiet revolution of empathic thinking and social action going on around the globe. With a little imagination, Australians could learn to harness the power of empathy to shift the contours of society. So what does this empathy revolution look like?

Intriguingly, empathy is a more popular concept today than at any moment in its history. It’s on the lips of everyone from the Dalai Lama to Barack Obama, from business gurus to happiness experts. Internet searches for the word “empathy” have more than doubled in frequency in the past ten years.

A major reason for this surge of interest is because of extraordinary new insights into the science of empathy. For more than three centuries we’ve been fed a dangerous piece of propaganda, which is that human beings are essentially selfish, individualistic creatures. But the scientific consensus has shifted in the last decade. We are also Homo empathicus: alongside our selfish inner drives is a more empathic, co-operative self.

Neuroscientists have discovered that almost all of us (exceptions include psychopaths) have a ten-section “empathy-circuit” wired into our brains. Damage part of it and you may be unable to recognise fear or other emotions on someone’s face. Evolutionary biologists have shown this co-operative, empathic self is a trait we share with our primate cousins, such as the hippie-like bonobo chimp. And psychologists have demonstrated that the empathic ability to step into another’s shoes and appreciate that their viewpoint may differ from our own develops in most children by the age of about two.

The problem is that we’re still not very skilled at tapping into our full empathic potential. But luckily empathy can be learned, like learning to ride a bike or drive a car. The best place to start is at school. I believe every child should have the right to take part in programmes such as Roots of Empathy, the world’s most successful empathy teaching initiative. Having started in Canada, it has now spread to countries such as New Zealand and Germany, and more than half a million children have done it. How does it work? The teacher is a baby.

True. A class of kids adopts a baby for the year, who visits every few weeks with a parent and an instructor from the programme. The children sit around the baby and discuss things such as: why’s the baby crying? Why is the baby laughing? What might she be feeling? This effort to step into the baby’s shoes is then extended outwards. What’s it like to be bullied in the playground, or to be made fun of if you’re in a wheelchair? The results are remarkable. A study in Scotland showed the programme boosted co-operative behaviour in 55% of pupils, decreased bullying and increased academic attainment. Roots of Empathy has been piloted in Western Australia. It’s now time to roll it out across the nation’s classrooms.

But we can’t wait 20 years for a new generation of empathic citizens to emerge. We also need to work on ourselves. On a personal level, try having a conversation with a stranger at least once a week. Get beyond superficial chatter and talk about the stuff that really matters in life – love, family, death or politics. Conversations with strangers are one of the best ways to overcome our prejudices and assumptions about others, and can cure us of making snap stereotyped judgements about people based on appearance or accent.

On the political level, we need to generate these kinds of conversations on a mass scale. One inspiring organisation that does this is the Parents Circle, which creates grassroots dialogues between Israelis and Palestinians. One of their most powerful projects was the Hello Peace phone line. Any Israeli citizen could call a free phone number and talk to a Palestinian stranger for up to half an hour, and Palestinians could similarly call Israelis. In its first five years of operation, more than a million calls were made.

Just imagine if there were similar phone lines (or online video dialogue projects) across Australia, which created conversations between climate change activists and climate change sceptics, between anti-immigrant advocates and new immigrants themselves, between bombastic politicians and their constituents who feel voiceless; between rich and poor, young and old. It would be the beginning of an empathy revolution. Not an old-fashioned revolution of new laws or policies, but something much more radical: a revolution of human relationships.

Roman Krznaric’s new book is Empathy: A Handbook for Revolution.