The Conservative party no longer conserves great British institutions, except for the monarchy and the Lords. It has become revolutionary, uprooting the public realm with tumultuous zeal. David Cameron's great talent is to seem so breezily moderate while dismantling so much – from the capacity of the civil service and local councils, to putting the NHS and free schools up for any bidder while undermining public trust in social security. Under cover of deficit cutting, his government takes a wrecking ball to anything branded "state".

You might think any true Conservative would want to conserve the BBC, a landmark of Britishness, globally admired export-earner, cultural nourisher, its independence proven by clashes with every government. But the confrontation this government has in mind is of another order: ministers, along with the radical 2010 intake of Tory MPs, want to reduce it to the insignificance of US public broadcasting. Why? Because this defiant symbol of non-market success is an affront.

The latest threat comes perversely from a review recommended by Leveson into media plurality, noting Murdoch's unhealthy political grip ever since Margaret Thatcher abolished media ownership rules, letting him take 40% of newspapers, plus Sky. But it's morphing into a review of BBC dominance instead.

The clue is in culture secretary Maria Miller's consultation paper to "prevent any one media owner or voice having too much influence over public opinion and the political agenda". It's "or voice" that changes everything, for by "voice" she means the ownerless BBC, with a threat to cut its output, especially online. To understand what's afoot read the Times cock-a-hoop leader crowing that the review will "decide the content" of the BBC charter in 2017 and "guarantee a level playing field for other media organisations" so the BBC will "stop producing written online news reports and analysis".

The BBC gets 73% of news audience because people choose it, though it only produces 25% of all news output. Newspapers worry it steals their readers, but Guardian media expert Steve Hewlett finds no evidence that cutting BBC Online would grow newspaper readers. Even if it did, that misses the point. The BBC is not an opinionator, and its size is no democratic threat but a democratic asset in a world where moguls buy press power. It's Murdoch who intimidates governments: see him intervening in the Australian elections to oppose state-provided broadband that threatens his business.

The BBC stands as a monumental public good with a cornucopia of information and entertainment, at under £3 a week. It's impossible to measure how intellectually impoverished or less well-informed the nation would be without it, but with overwhelming public support and trust, only 3% want it shut down. Sky packages, costing up to £500 a year, are parasitic on the BBC, since Sky subscribers watch more BBC than Sky channels – yet the BBC pays to appear on the Sky platform, instead of being paid. Competing with the BBC may be hard, but the rest of us just have to swim alongside this whale of a national asset.

None of that protects it against justified criticism – currently for grossly overpaying executives. Just as the BBC is not a competitor in Murdoch's market, it should not pay "market" executive salaries. By failing to rein in excess, the BBC Trust opened a door to parliamentary scrutiny: the National Audit Office questioning BBC efficiency ultimately leads to interference with the value of content, crossing a dangerous line on independence.

Tory outriders join the fray, as the Centre for Policy Studies this week claims the BBC is biased leftwards by favouring reports of centre-left over centre-right thinktanks. That's highly specious without independent assessment of the relative quality and news-worthiness of the research in those reports: IPPR v IEA is a no-brainer for news content. Let no one doubt how much the BBC agonises over bias, although its self-criticism, recently on immigration and climate change reporting, is always seized on as another weapon by its enemies.

The BBC will forever be a battleground. Who doesn't shout at the screen, spying bias? James Harding, the Times editor who fell out of favour with his proprietor, starts as director of BBC News this week, arriving when the BBC is in need of bolder, more authoritative reporting. Under a hail of political bullying, the only protection is correspondents with the expertise to make judgments (not the same as opinions) that may challenge the government. BBC economics reporting has just that quality, but its reporting, for example, on the NHS revolution has been anaemic, too often parroting "this puts the NHS in the hands of GPs". The challenge is to be unafraid of controversy yet judicious, without retreating into "on the one hand, on the other hand, only time will tell".

These dilemmas are familiar enough to Tony Hall, the new director general and former head of news returning with the kudos of transforming the Royal Opera House. He won't be easily rattled by the forces rattling the BBC's cage. Expect him to resist the review being turned into a weapon against the BBC. Maria Miller has shown her hand: unsurprisingly she takes the Murdoch line. Harriet Harman, shadow culture minister, has planted Labour's stake firmly on the side of preventing any one media magnate seizing more than 20% of the market.

Newspapers are still the nation's political megaphone, regardless of dwindling sales. When scarcely an edition of the Sun, Times, Sunday Times or indeed the Mail leaves the presses without a tilt at the BBC, that's alarming. If the Conservatives won the next election, would the BBC survive the redrawing of its charter in 2017 in anything like its present splendour?