In May, Sydney University announced its library "restructure". This magnificent library, among the country's finest, had already, a decade earlier, deacquisitioned some 60,000 books and theses. More recently there were further, unquantified and undeclared cloak-and-dagger dumpings to make space for the wifi and lounge-chairs that have given the once magical Fisher stack the look and feel of a church playgroup. But the next phase is really radical. Closing two specialist libraries (Medical and Badham) and turning two others (Camden and Dentistry) into 24-hour vending machines, it targets anything not borrowed in the last 5 years, removing and/or destroying up to 500,000 books and jeopardising about 60% of the librarians' jobs. Protests have been campus-wide but are unavailing. Sydney is not alone. Many of its books were given to the University of Western Sydney – and then dumped. Univeristy of NSW had already undertaken a similar process, while the University of Technology, Sydney library has gone proudly underground, into a space that could earn the university extra income as a set for Stasi thrillers. And it's not just old fiction being dumped. Sydney University Emeritus Professor of Literature Michael Wilding says the library no longer keeps Who's Who. Associate Professor of Medicine Catherine Storey, OAM, says many of the works she uses have not been digitised. And online is not forever. Digital records are only as good as the machines reading them, as the 2002 scandal over the BBC's e-readable Domesday Book demonstrated. For once we should be pleased that Australia is laggard. Overseas institutions have been book-dumping for years. In 1993, after a specialist library in Manchester was discovered privately flogging its very rare books, Charles Cutting wrote a satirical novel in which, he said, "libraries would cease to be repositories of books, and would instead become buildings housing vast banks of terminals". Now it has happened. As if the name matters more than the fact, we have the "bookless library".

Bexar County, Texas, recently declared itself the world's first public library-sans-books. Now there are half a dozen others, including the massive and celestial $60 million Florida Polytechnic, a soaring white "library" space straight out of Cutting's novel, purpose-designed by Santiago Calatrava but with no books. The information desk becomes the "success desk". Librarians become "informationists" and battle often prohibitive publishing protocols to lend e-materials. If you want an old-style book it must be roboted up from some distant dungeon or institution. So, question. Is this the book-burning that many scholars and intellectuals fear? Is it the equivalent of the anti-intellectual purge of the Nazis or Chairman Mao? Are we swiping and clicking our way into a new dark age? Parallels are drawn with all the tyrannies of history that have targeted knowledge as threat. Others argue that digitisation is a simple change of mode; form not content. Not losing a collection but gaining a liberty. Which is true? And what exactly is a library with no books, beside a website, a database, a cloud? Why, in the age of mobile mini-tech and ubiquitous wifi does such a library even exist? Couldn't it just be a basement server with a million e-books on remote access? And what do we lose, if anything, in the physicality of the book, and of its trove, the library?

Librarians have angsted for decades about what "library" might mean in the future. Their best guess is a kind of light-filled community centre offering wifi, yoga rooms, self-improvement classes and atmospheric positive thinking. The very vagueness plays into the bean-counters' hands. Nothing's easier to axe than a bunch of wishy-washy. Ancient libraries, from Alexandria and Pergamum to Trinity College Dublin were sacred repositories of knowledge; fiercely defended and intensely beautiful, home to the collective dreaming. Their architecture, across eons and cultures, reified this. Domed, vaulted, arched and groined, libraries created head space. No longer. It's not just Abbott, Thatcher or Friedman. The seeds of the destruction were sown a century ago, when Modernism sold us the patent misconception of humans as simple machine-like creatures whose needs can be captured in a checklist. Accept that paradigm and everything shrinks to fit. Libraries morphed overnight into soulless, fluoro-lit spaces with 2.4 metre pegboard ceilings, plastic carpet and thin metal shelves. Imagination? Humbug! This ridiculous reductivism still shapes everything; in particular the unquantifiable life of the mind. And yes, there is an element of tyranny here but it's subtle, inaccessible to the quality assurance types who have turned our libraries and universities into knowledge factories. Most writers and thinkers will tell you how much they have learned by accident – from browsing semi-randomly, semi-consciously in libraries and bookstores. And yes, you can browse online. We all do. But the mind-state is different; more intellect-only, more pull, narrower.

There's also a quality issue, eBooks are cheaper and more portable, but it is still staggeringly difficult to find good things to read outside bestseller lists. But here's what I think. We are complex creatures whose physical and psychic natures inextricably intertwine. Children get this. Today's kids, who should be the first bookless generation since Gutenberg, tell me they like books. The touch, the texture, the smell, the fact. They're bored with screen-everything. This may be why the children's book market is the least e-dominated sector: a small flame of hope flickering over the e-tide. Elizabeth Farrelly's book of fictional crime for children, Caro was here, (Walker Books) is published this month. Twitter: @emfarrelly