It was probably just an eerie coincidence. On Friday night the Islington home, and office, of a publisher were firebombed. It was 20 years to the day since the publication of The Satanic Verses.

Whether the alleged perpetrators of the attack knew the significance of the date I do not know. What seems certain is that Martin Rynja, the director of Gibson Square, was targeted because he is about to publish The Jewel of Medina, a romantic tale about Aisha, the Prophet Muhammad's youngest wife. Written by an American journalist, Sherry Jones, the novel was originally bought by the American publisher Random House for a $100,000 advance. But earlier this year it pulled out of the deal for fear of sparking another Rushdie affair.

As works of fiction, the two books have little in common. The Jewel of Medina is a breezy historical romance, The Satanic Verses a complex, chaotic exploration of “migration, metamorphosis, divided selves, love, death”, as Salman Rushdie put it. What links them is Islam and free speech - and 20 years of weakening liberal resolve to defend freedom of expression.

The Satanic Verses was not just a novel about migration but also a satire on Islam, “a serious attempt”, in Rushdie's words, “to write about religion and revelation from the point of view of a secular person”. For some that was unacceptable. Five months after publication, on February 14, 1989, the Ayatollah Khomeini issued his fatwa. “I inform all zealous Muslims of the world,” he proclaimed, “that the author of the book entitled The Satanic Verses and all those involved in its publication who were aware of its contents are sentenced to death.”

In 1989 even the Ayatollah's death sentence could not stop the publication of the novel. Rushdie was forced into hiding for almost a decade, translators and publishers were killed, and bookshops bombed. Yet Penguin never wavered in its commitment to The Satanic Verses.

Today all it takes for a publisher to run for cover is a letter from an outraged academic. In March, Random House sent galley proofs of The Jewel of Medina to various academics, hoping for endorsements. One of them, Denise Spellberg, an associate professor of Islamic history at the University of Texas, condemned the book as “offensive”. Random House immediately dropped it. No other big American publishing house would touch it. Martin Rynja, a fierce advocate of free speech, eventually picked it up in Britain.

What the differing responses to the two novels reveal is how Rushdie's critics lost the battle but won the war. They never prevented the publication of his novel. But the argument at the heart of the anti-Rushdie case - that it is morally unacceptable to cause offence to other cultures - is now widely accepted. In the 20 years between the publication of The Satanic Verses and the withdrawal of The Jewel of Medina, the fatwa has in effect become internalised.

“Self-censorship”, Shabir Akhtar, a British Muslim philosopher, suggested at the height of the Rushdie affair, “is a meaningful demand in a world of varied and passionately held convictions. What Rushdie publishes about Islam is not just his business. It is everyone's - not least every Muslim's - business.” Western liberals have come to agree.

In the past, free speech was viewed as an inherent good, to be restricted only in exceptional cases. Today it is seen as an inherent problem, because it can offend as well as harm, and so has to be restrained by custom, especially in diverse societies. These days not only do publishers drop books deemed offensive, but theatres mutilate plays, opera houses cut productions, art galleries censor shows, all in the name of cultural sensitivity.

Last week, before the firebomb attack, I spoke to Sherry Jones. “If Random House had simply published my book”, she told me, “I don't think there would have been any trouble. The real problem is not that Muslims are offended but that people think they will be. I was disgusted by the inflammatory language Random House used to describe the potential Muslim reaction.”

There will always be extremists who respond with fire. There is little we can do about them. The real problem is that their actions are given a spurious legitimacy by liberals who proclaim it morally unacceptable to give offence.

Shabir Akhtar was right: what Salman Rushdie or Sherry Jones says is everybody's business. It is everybody's business to ensure that no one is deprived of their right to say what they wish, even if it is deemed by some to be offensive. In a plural society it is both inevitable and important that people offend others. Inevitable, because where different beliefs are deeply held clashes are unavoidable and these should be dealt with openly rather than suppressed. Important because any kind of social progress requires one to offend some deeply held sensibilities. “If liberty means anything,” as George Orwell put it, “it means the right to tell people what they do not want to hear.”

Kenan Malik's Fatwa to Jihad: the Rushdie Affair and its Legacy is published in the spring

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