How can we best combat the anti-immigrant populists who are now making the political running in many European countries? Later this month, the verdict is due in the trial of the Dutch politician Geert Wilders for anti-Islamic statements he has made – such as that the Qur'an is a "fascist book" which should be banned. At the same time, the country's minority centre-right government depends for its survival on the "tolerance" of Wilders' Party for Freedom (PVV), which won more than 15% of the vote in the last general election. Wilders' price included a commitment to a burqa ban.

Illustration by Matt Kenyon

In the Netherlands, as elsewhere in Europe, centre-right parties have been trying to win back voters who have turned to such anti-foreigner populists by adopting slightly toned-down versions of their rhetoric and policies.

So the courts are being asked to do what the politicians won't. This is the wrong way round. For reasons both of free speech principle and political prudence, Wilders should not be on trial for what he says about Islam. Instead, mainstream democratic politicians, and other opinion-leaders, should be more brave and outspoken in combating his inflammatory rhetoric.

That is what the Dutch prosecutors seem to have thought too. "No doubt his words are hurtful and offensive for a large number of Muslims," they said, when a prosecution was first suggested, but "freedom of expression fulfils an essential role in a democratic society." However, a group of prominent lawyers, NGOs and interest groups got an appeal court to reverse this decision and oblige the reluctant prosecutors to prosecute. The court argued that "by attacking the symbols of the Muslim religion, he also insulted Muslim believers".

That sentence perfectly exposes the problem of principle: a blurring of the line between attacking the believers and criticising the belief. For we must remain free to criticise any belief, even in extreme terms. Religion is not like skin colour. There is no rational argument against the colour of someone's skin. There are important, rational arguments to be made against Islam, Christianity, Buddhism, Scientology or any other belief system. Such prosecutions, even if their purpose is to defend the human beings, will have a chilling effect on discussion of the beliefs.

There is also a wider context here. Members of the Organisation of the Islamic Conference have long been arguing for an international outlawing of the "defamation of religion". In the country where the director Theo van Gogh was murdered for offending Islam, Wilders himself has to live under round-the-clock security because of death threats from violent Islamist extremists.

If Wilders were himself inciting people to violence, then he should be prosecuted. But so far as I can see, he has steered just the right side of that line. So long as that is true, I defend his right to say deeply offensive things, on the same grounds that I recently defended a woman's right to choose to wear the burqa. The blonde-maned Wilders is, so to speak, the burqa of the other side.

Beyond the argument of principle, there is a strong practical one. As happened when David Irving was put on trial in Austria, this prosecution enables the defendant to present himself as a martyr for free speech. Wilders ended his final statement to the court with a heroic quotation from George Washington: "If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter."

This from the man who calls for the holy book of some 1.5 billion people to be banned! Double standards are the bane of many free speech claims, but Wilders takes the gold medal for hypocrisy. Not only does he want the burqa and the Qur'an to be banned. At a speech delivered in the House of Lords last year – after the idiotic entry ban imposed on him by Labour home secretary Jacqui Smith had been reversed – he said that, throughout the west, we should forbid the construction of any new mosques.

It's not just Muslims he wants to gag. It's also his own critics. Under pressure from Wilders' Freedom party, a distinguished cultural historian and commentator, Thomas von der Dunk, was recently disinvited from giving a lecture in honour of a Dutch anti-Nazi resistance hero, after it became known he proposed to compare the Freedom party's portrayal of Muslims to "the way in which Jews were smeared in the 1930s". A punk song referring to Wilders as the "Mussolini of the Low Countries" was banned from a festival celebrating the liberation of the Netherlands from Nazism. A leftwing broadcaster took down a cartoon showing Wilders as a concentration camp guard from its website after what it described as threats to its staff.

In short, the Freedom party's idea of freedom is that Wilders must be free to call the Qur'an fascist but no one should be free to call Wilders a fascist.

Yet the parties of the centre-right, depending on Wilders' "tolerance" for their survival in power, go along with and appease this intolerance. Yes, the preface to the coalition agreement has one sentence saying that the governing People's Party for Freedom and Democracy (VVD) and Christian Democratic Alliance (CDA) "see Islam as a religion and will treat it accordingly – unlike the PVV". But, as in many other European countries, the mainstream centre-right parties hurry to appease and follow the illiberal, anti-immigrant and specifically anti-Muslim populists, just as mainstream centre-left parties have too often bent to appease illiberal, self-appointed "Muslim community" voices.

This week, a Council of Europe working group of which I am a member suggests a different approach. Our report, entitled Living Together: Combining Diversity and Freedom in 21st century Europe, argues that European societies should be rigorous in demanding and enforcing equal liberty under a single law. There should be, so to speak, a muscular liberalism of the broad democratic centre.

But we should not demand that people of migrant origin abandon their faith, culture or multiple identities. Messages of intolerance and xenophobia, such as those purveyed by Wilders, should be combated in the court of public opinion, not the court of law. Our motto is "minimise compulsion, maximise persuasion". Mainstream politicians, intellectuals, journalists, businesspeople, sporting heroes, all should mobilise to persuade anxious European publics that, so long as people abide by the ground rules of a free society, they have as much right to be full and equal citizens as anyone else – whether they be Muslim, Christian, atheist or Zoroastrian. And that we Europeans can make this work.

I don't wish to implicate other members of the group in my application of this principle to the Wilders case, on which they may disagree, but it seems to me that we liberals – that is, those who give the highest priority to individual liberty – should have the courage of our convictions, especially when they lead us to uncomfortable places. So Wilders should be free to call the Qur'an fascist, von der Dunk should be free to compare Wilders to the Nazis – and politicians should stop hiding behind the robes of judges. Instead, they must get out there and fight the good fight themselves.