Clement Attlee enjoyed the superiority of a postwar Englishman when he dismissed European unity in 1967 with a contemptuous sniff. "The Common Market. The so-called Common Market of six nations. Know them all well. Very recently, this country spent a great deal of blood and treasure rescuing four of 'em from attacks by the other two." For Germany and Italy, which had suffered under fascist dictatorships, and for France, Holland, Belgium and Luxembourg, which had suffered under fascist occupation, there was nothing in the war years to be superior about. The Common Market promised liberation from a terrible past. And continued to promise it.

Greece, Portugal and Spain confirmed their break with dictatorship and reaction when they joined. After the fall of the Berlin Wall, Europe expanded its borders by offering the once subject peoples of the communist empire a better life in a democratic haven. Nazis and communists never occupied Britain. Our leaders sold us Europe as a smart investment opportunity rather than a democratic advance and we never felt the idealism behind European dream. Lech Walesa knew better. On the eve of Poland's accession, he said: "I fought for our country to recover everything it lost under communism and the Soviets… and now my struggle is over. My ship has come to port."

Europe replaced the terrors of totalitarianism with human rights conventions and peace treaties. It is easy to become exasperated by the monotony of its composite resolutions and interminable meetings. But tens of millions accepted the chance of trading national sovereignty for freedom from the dictatorships of their day.

That deal is no longer on offer. The dictatorships of our day come in many types, but the dominant form is a state capitalism or oligarchy in which the boss or ruling clique control public assets and the sinecures that go with them. Strictly speaking, they are not full dictatorships. Rulers tolerate elections as long as their results can be manipulated and allow criticism as long as it does not reach the masses.

The campaign group European Alternatives defined modern crony states thus: "In a country where television channels represent the only source of information for over 80% of the population, control over the media must not of necessity assume the draconian and totalitarian methods its 20th-century precedent. Manipulation of the principal, mass media of a country can today perfectly coexist with the maintenance of dedicated 'Indian reserves' of opposition, flag bearers of a merely procedural freedom of expression."

If the authors sound like high-minded European liberals lamenting far-away miseries, I should add that they were not discussing Putin's Russia or Chávez's Venezuela but Berlusconi's Italy.

Because the British care so little for Europe, no one apart from constitutional lawyers studies the <a href="http://europa.eu/lisbon_treaty/glance/index_en.htm" title="Charter of Charter of Fundamental Rights in the Lisbon Treaty. In Brussels, however, Eurocrats pretend to take it seriously. Article 11 guarantees freedom of the press and media pluralism, but Europe is happy to see Berlusconi exercise direct control of the three Mediaset private channels, his publishing house, advertising company and cinema distribution business and indirect control through his sycophants of Italy's public television channels and the vast advertising budgets of the Italian government.

Last week in the European Parliament, socialist delegates tried to turn the rotten state of Italy into a European issue, only to see the "moderate" conservatives of the European People's party turn on them. Nicolas Sarkozy's ally, Joseph Daul, was outraged that leftists could dare suggest Italy was anything other than "a democratic country where the rule of law was respected". The supporters of Angela Merkel refused to accept that Europe needed to defend Italians' fundamental rights. So angry were the supposed moderates at the insult to Berlusconi's good name that they not only argued against intervention, but tried to prevent the debate taking place.

When David Cameron led the Tories out of the European People's party to march in step with the SS veterans of the Latvian Fatherland and Freedom party, I and many others accused him of abandoning the European mainstream. I should have added that the mainstream in Brussels has dark depths of its own. When its outwardly respectable democrats find that a fellow conservative is creating a crony state at the heart of Europe, they do not protest but direct all their energy and passion into berating his opponents.

You could say, and "moderate" conservatives were saying in Brussels, that the Italian judiciary had proved Italy remained a liberal democracy by stripping Berlusconi of immunity from prosecution. Yet Berlusconi has seen off the judges before. In any event, even if he falls or, more likely, retires, Italians will not expect his corrupt system to go. Berlusconi's private channels are unlikely to become beacons of public-service broadcasting after his departure. The quaintly titled "post-fascist" leader Gianfranco Fini will not give up a system of patronage and censorship in which the state can organise advertising boycotts of critical papers and force out editors who report unwelcome news.

The most telling feature of the caudillos of our day is the ease with which they put aside nominal ideological differences and recognise each other as members of an international freemasonry of autocrats. Berlusconi denounces investigating magistrates as "communists" and yet calls the former KGB man Vladimir Putin "his great friend". The nominal socialist Chávez allies with the Islamist reactionary Ahmadinejad. What unites the boss men of the 21st century is more important than what divides them.

Democratic Europe, however, will not unite against them by standing up for its best values. Its silence about Berlusconi – by turns both cowardly and compromised undermines its ability to stand up to corrupt politics anywhere else in Europe, most notably in the weak democracies of the post-Soviet east, and makes a nonsense of its condemnations of abuses of democratic rights beyond its borders. For the first time in its history, Europe's reputation as a force for good in the world feels precarious. Soon it will feel fraudulent.