Just what are these operations about? You may remember MI5 chief Eliza Manningham-Buller suggested last November that the intelligence services had discovered 30 "plots to kill people and to damage our economy", often with "links back to al-Qaida in Pakistan and through those links al-Qaida gives guidance and training to its largely British foot soldiers here on an extensive and growing scale". The authority for such a statement, I assume, comes from MI5 agents. The quality of such reports, though, must be treated with profound scepticism, dependent as they are on the doubtful calibre and knowledge of these agents and the tendency of such people to live in a semi-fantasy world of endless conspiracy. The fact remains that, notwithstanding the huge security operations and the large numbers arrested, relatively few people have actually been charged. The test of justice is, fortunately, more demanding than the criteria used to justify headlines and political hyperbole.

Of course, we must take terrorist threats seriously - but also the price we pay for these alarums. They magnify our sense of trepidation and persuade people the worst is about to happen: it is under the cloak of such fear that governments on both sides of the Atlantic have been able to impose swingeing restrictions on civil liberties. The fact remains, however, that deaths in the UK from Islamist terrorism have been far fewer than those perpetrated by the IRA. Meanwhile, the price for these constant security operations is paid, above all, by our Muslim communities. Every such operation tars them with the brush of terrorism, an intimation to rest of society that extremism lurks within their ranks.

The scapegoating of the Muslim community has become the stock in trade of politicians, the Conservatives recently accusing the Muslim Council of Britain of separatist tendencies, and New Labour all too frequently indulging in the same kind of refrain - notably during the most disgraceful period of its domestic rule last autumn, when cabinet ministers were falling over themselves to make disparaging remarks about the Muslim community.

The argument typically starts from the global terrorist threat and ends up by suggesting the Muslim community nurtures and sustains such a terrorist mentality by its failure to integrate. Jack Straw squirmed about the veil, Ruth Kelly inveighed against imams, Alan Johnson proposed that faith schools admit up to 25% not of the same faith (patently directed against the Muslim community), and John Reid warned a Muslim audience of "fanatics looking to groom and brainwash [your] children ... for suicide bombing". Amid this panic-inducing rhetoric, there was little acknowledgment that Muslims suffer more discrimination than any other section of society, no recognition that every attack on their community can only intensify that prejudice. Imagine what it feels like to be a Muslim, stalked by a constant sense of distrust and suspicion? As a society we may condemn racism, but when it comes to Muslims, it seems to be somehow acceptable, from the cabinet downwards.

And what is to blame for this failure to integrate? Prejudice, perhaps? Discrimination? Racism? No, according to David Cameron, Ruth Kelly and many others, the cause would appear to be multiculturalism. Pause for a moment and spot the slippage in the argument. It is no longer only about Muslims but all our ethnic minorities. For enshrined in the principle of multiculturalism is the idea that the white community does not insist on the assimilation of ethnic minorities but recognises the importance of pluralism. It is not about separatism but a respect for difference - from colour and dress to customs and religion. The attack on multiculturalism is the thin end of the racism wedge. It seeks to narrow the acceptable boundaries of difference at a time when Britain is becoming ever more diverse and heterogeneous.

None of this is to deny the importance of finding ways of integrating the Muslim community. It is hardly surprising, though, that many young Muslims feel alienated. They face worse discrimination in education and employment than any other ethnic minority, Anglo-American policy in the Middle East has had the effect of demonising the Muslim world, and the Muslim community here finds itself the victim of a barrage of hostile propaganda. A major assault on discrimination involving the government, the media and the Muslim community is long overdue. But while British foreign policy so profoundly discriminates against the Muslim world, and New Labour remains in denial about the connection between domestic Muslim attitudes and its foreign policy, there seems little prospect of making a new start.

Antipathy towards Muslims, meanwhile, threatens to roll back hard-fought anti-racist gains, which, over the decades, have won a degree of respect for ethnic minorities and an acceptance of the principle of difference. These gains have always been fragile. Important ground is now being ceded as Islamophobia becomes the acceptable face of racism and the attack on multiculturalism finds important new recruits.

· Martin Jacques is a visiting research fellow at the Asia Research Centre, London School of Economics.

martinjacques1@aol.com