"(the) defence of the new imperialism is based on a view that the west is always best. Those who insist that the US should take on a yet more assertive global role don't believe that Asians, Africans or Arabs can create prosperity and order on their own behalf. Without western imperial order, so this argument goes, the world would be a nasty, brutish place... Far from being backward and uncivilised, Mughal India exported high quality manufactured goods to Britain's fashionable society. Aristocrats had Indian chintz on their walls and Indian cloth on their tables. British manufacturers often labelled poorer quality British imitations as "Indian" to dupe customers into buying their own shoddy goods. After all, why were the British interested in trading with Asia at all? It was to make money out of a wealthy society - not to invest and civilise..."

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Niall Ferguson is the Leni Riefenstahl of George Bush's new imperial order. Just as Riefenstahl's photography glorified the violence of fascism and sold it to the middle classes, Ferguson's Channel 4 series and book on the British empire presents the acceptable face of imperial brutality.

From hawks within the Bush administration to their cheerleaders on the Mail and Telegraph, the invasion of Iraq is justified in the name of a new benevolent colonialism. Just as the world is preparing for a fresh western war of conquest, Ferguson arrives to convince us that imperialism can be a Good Thing. With its swashbuckling heroes and glamorous locations, his series Empire lends fake historical legitimacy to this new imperial enterprise. But by using Britain's imperial past to justify America's imperial future, Ferguson's arguments are misleading and dangerous. Worst of all, they encourage policy based on a version of the history of empire that is simply wrong. Apologists for the new imperialism argue that Pax Britannica ushered in an unprecedented period of worldwide peace and prosperity. If the US took its global responsibilities seriously, they claim, Pax Americana could now do the same again.

This new imperialism tries to justify itself with a story about Britain's introduction of free trade, the rule of law, democracy and western civilisation across the globe. "No organisation", Ferguson says, "has done more to impose western norms of law, order and governance around the world." That story is a fable dreamt up by 19th-century propagandists to sell the benefits of empire to an uncertain public back home.

Instead of enriching the world, the British empire impoverished it. The empire was run on the cheap. Instead of investing in the development of the countries they ruled, the British survived by doing deals with indigenous elites to sustain their rule at knock-down prices.

Whether in 18th-century India, 19th-century Egypt or 20th-century Iraq, the story is the same. As long as taxes were paid, the British cared little about how they were collected. Far from imposing "the rule of law", they turned a blind eye to Indian landlords who extracted rent by coercion or white planters who evicted their African neighbours by force. Despotic repression was fostered where it protected British interests. Many of those petty despotisms are still with us today. The feudal lords now massacring villagers in the Indian state of Bihar were created by British land policy. The northern Nigerian emirs who sentenced Amina Lawal to death for adultery last year owe their existence to the dubious practices of British imperial rule.

Ferguson's defence of the new imperialism is based on a view that the west is always best. Those who insist that the US should take on a yet more assertive global role don't believe that Asians, Africans or Arabs can create prosperity and order on their own behalf. Without western imperial order, so this argument goes, the world would be a nasty, brutish place. Muslim countries are singled out as being particularly incapable of looking after their own affairs.

Such views are based on a woefully inaccurate version of the history of the non-European world. Take India, for example. Ruled by Muslims before the British, India was a prosperous, rapidly commercialising society. The Jagat Seths, India's biggest banking network, rivalled the Bank of England in size. Ferguson argues that the British built useful things - opulent viceregal palaces and machine guns, perhaps. In contrast, Indians wasted money on conspicuous consumption. Does he mean the Taj Mahal?

Far from being backward and uncivilised, Mughal India exported high quality manufactured goods to Britain's fashionable society. Aristocrats had Indian chintz on their walls and Indian cloth on their tables. British manufacturers often labelled poorer quality British imitations as "Indian" to dupe customers into buying their own shoddy goods. After all, why were the British interested in trading with Asia at all? It was to make money out of a wealthy society - not to invest and civilise.

British rule pauperised India. The British restricted Indian weavers' ability to trade freely and the result was a drastic drop in living standards. Dhaka, now the capital of impoverished Bangladesh, was once a state-of-the-art industrial city. Its population fell by half during the first century of British rule. In 1750, Indians had a similar standard of living to people in Britain. Now, average Indian incomes are barely a tenth of the British level in terms of real purchasing power. It is no coincidence that 200 years of British rule occurred in the intervening time.

When not subject to western intervention, the non-European world is of course more than capable of looking after its own affairs. The argument that Africans, Arabs and Asians need to be "civilised" by force has repeatedly ended up being used to justify oppressive regimes. The British extinction of the aboriginal population of Tasmania or the barbaric penal colony on the Andaman Islands (the early 20th century's Guantanamo Bay) were justified in the belief that the "natives" couldn't expect any better.

Empire is always counter-productive. Imperialism creates weak rulers who demand further cycles of imperial violence to stay in power. British colonial power could only be sustained by the large-scale use of brutal force across four continents. In the dying days of imperial rule, the British maintained their rule by acts of terror like the Amritsar massacre and the frenzy of colonial violence that followed the Mau Mau uprising in Kenya. In neither case does one find much sign of the "rule of law".

The story that Ferguson tells is typical of the arguments liberal imperial propagandists made during the 19th century. After all, even John Stuart Mill (an employee of the East India Company) regarded imperialism as benign. But based on a version of British history last taught well over half a century ago, these kinds of arguments are not taken seriously by historians today. Until recently, it seemed that 19th-century liberal orthodoxies about "progress", "order" and the benefits of British colonial rule had become the marginal province of the fogeyish fringe of the Tory right.

But now Ferguson's retro chic defence of the new imperialism has alarmingly seeped out of the confines of its conservative redoubt into the mainstream. Jack Straw should be lauded for having had the courage to suggest that political instability in the Middle East, Asia and Africa has something to do with the legacy of British rule in places like Zimbabwe, Palestine, Iraq and India. But his belief that the wrongs of imperial violence in the past can be righted by a further wave of imperial violence now is based on the same arrogant mistake.

The new liberal imperialists believe the west has the power to remould the rest of the world in its own image. It doesn't. Instead, imperialism creates a cycle of violence and poverty that advances the short-term interests of a few by impoverishing us all in the long term. If policy-makers are going to take history seriously, they should base it on something more sophisticated than Niall Ferguson's glossy glorification of imperial violence.