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A neigbourhood is characterised by things we share in common. Traditionally we think in terms of sharing a common geography: 'We live here, they live next door, we are stuck in this street together, let's see if we can make this work.' But you can also think of neighbourhood in other ways - virtual neighbourhoods via computer networks or geopolitical neighbourhoods. When it comes to building a neighbourly relationship – as with any relationship – we look for things we have in common.

That can be difficult when you don't see any commonality. This is where relationships are tested. It's not really that hard to have a relationship with people who are similar. The difficulty arises where you run up against some kind of difference. Even if the difference is superficial, so long as you don't perceive it as such you will find the building of that relationship difficult. That is the real trouble that we are facing today. It's not about 'how do we build relationships with other people?' It's about 'how do we build relationships with those we consider fundamentally different from us?' At the most fundamental level – it is not about building relationships with other people, it is about building relationships with others we really, deep down, do not consider to be people at all.

Relationships between people who are noticeably different can only proceed once both parties to that relationship conquer the intellectual disease of egocentricity. What I mean is that the vast majority of us, if we are really being honest with ourselves, tend to approach people with a deep assumption that 'the world would be a much better place if only everybody was just like me'.

An interaction where both parties have that mindset is hard-wired for conflict. It is also hardwired for destruction. A current example of this on the geopolitical stage is from the war in Iraq.

Back in the very early period of the war, the 'Coalition of the Willing' were trying hard to create a post-Saddam Hussein Iraq that was, essentially, a mini-America. The United States had power of veto over the development of the Iraqi constitution and made it absolutely clear that it wanted a system that was modeled on American-style secular democracy.

I don't have a problem with the US constitution. There's a lot of great things about the American system of government and a lot of great things about the way American society and politics are structured. But Iraq is not America. The problem was that we were taking a template of conclusions – of historical lessons derived from European history – and applying it to a country that had a very different history, a different sociology, and a different present.

This was most manifest when it came to the idea of the secular state. Secularism as a European idea, as an idea of liberation from the tyranny of theocracy, was being imposed in a country that had just been brutalised by one of the most avowedly secularist rulers that had been known in the region's history.

In the West we are wary of religion in the political sphere, conditioned by a history of brutal oppression and repression in the name of God. Throughout the Middle East you can see increasing evidence emerging of a mentality that is hard-wired in the opposite direction. Since the colonial period, the absence of religion in the public sphere has been accompanied by a stream of very dictatorial regimes. So the idea of religion coming back into the political sphere is seen, by many, in much the same way that people in the West see a bill of rights – as a means by which rulers can be held accountable to some kind of external standard.

This, of course, sounds totally bizarre to the Western political ear, because it runs counter to every experience that Western society has had. My point here is not to adjudicate between the two, but to point out that we are dealing with histories that almost run in opposite directions. And to the extent that we are all products of our history, we will draw different conclusions and yearn for different things.

It is not a lesson that many people involved in that particular excursion have heeded. What is at play there, fundamentally, is an egocentricity. It is one that says, 'the lessons I draw from the world are of universal application and are not contingent in any way on my own historical experience'. It is not about saying: 'I am a product of my history and these are the lessons I draw from my history' – it is about saying: 'I am a universal human, and the world would be better if you were like me'. It is the view that deep within every person, whether in Iraq, Somalia or elsewhere, is a little post-Enlightenment European that really needs to be uncovered – possibly with some kind of military action.

The same lessons apply closer to home. How do we overcome the climate of fear? We need to look for the commonalities and acknowledge them, and then we need to understand the workings behind the differences.

It's not about overlooking the difficult issues and hoping we don't come up against some kind of major combustible social force. It's about having some kind of intellectual matrix for understanding our differences. Then we begin to understand people not solely in terms of their difference – this person comes from that country, so when they drop litter it is because they are from that country – but we understand that human behaviour is a product of a whole complex of inputs. When we do that, not only do we get a much more sophisticated analysis, we get one that can provide a bedrock for a more positive kind of interaction.

Without that, ultimately, we're hard-wired for conflict. And that, I think, is the current state not just of the world but of our domestic societies. That's our future unless we choose to do something about that.

Waleed Aly is a commercial lawyer and a member of the Islamic Council of Victoria Executive Committee. This talk was given on 13th January 2007 at the “Australia as a Neighbour” conference, organised by Initiatives of Change.