David Cameron's recognition that we should acknowledge the dangers of extremist ideology, and the need to tackle it head-on, is welcome. His call for a social vision that young British Muslims can feel part of, to overcome the sense of rootlessness which can make a minority vulnerable to extremist recruitment, makes eminent sense. And his condemnation of the divisive impact of segregated communities, along with state support for groups with backward ideas about women and society, is certainly important – though hardly groundbreaking.

But by identifying the root cause of terrorism as an amorphous "state multiculturalism", Cameron reveals his understanding of the problem is as simplistic as his predecessors'.

The background of those convicted on terrorism charges undermines his suggestion that there should be a crack-down on "non-violent extremists" – a category that could include anyone from climate protesters to student dissidents. Over a third of terrorism convictions between 1999 and 2009, and every single major terrorist plot in the UK including 7/7, were linked to the extremist network formerly known as al-Muhajiroun. Yet despite being proscribed, the network has never been fully investigated by police. Many of its leaders roam free despite a track record of inciting violence, while its spiritual leader, Omar Bakri Mohammed, was able to escape to Beirut despite confessing to having advanced warning of al-Qa'ida plans to bomb London.

These links are compounded by an interventionist foreign policy that has been heavily disfigured under the influence of short-sighted (and self-interested) US geostrategy. In Pakistan and Afghanistan, for instance, the radicalisation of the insurgency has accelerated in direct proportion to Nato's troop surge, and civilian casualties from airstrikes have inflamed grievances both locally and in the UK.

In Britain, the mood is exacerbated by domestic policies that reinforce the structural problems prevailing in many British Muslim communities. For instance, Cameron overlooks how government policies have intensified British Muslim social exclusion. The dogmatic adherence to neoliberal principles pursued by all governments have widened inequalities in the UK with debilitating consequences for both white and ethnic minority working class communities. So 69 per cent of British Muslims of South Asian background live in poverty, compared to 20 per cent of white people. Meanwhile, questionable local council housing policies systematically house white and ethnic minority communities in segregated areas of the same cities. The upshot is that Muslims in Britain are now overrepresented in poor housing, unemployment, low educational achievement, and in prisons.

Poverty by itself does not cause extremism, but on this scale feeds the sense of a separate identity. The danger is that by blaming "state multiculturalism", Cameron is not simply missing the point, but undermining goodwill on both sides of the fence. As inequalities deepen under coalition cuts, social cohesion will be challenged. Meanwhile, his speech will be exploited by militant Muslims to back their claims that the state is the avowed enemy of Islam, and by far-right extremists to legitimise their hostility.

Rather than dealing with the root causes of terrorism, this just risks making things more volatile.

Dr Nafeez Mosaddeq Ahmed is author of 'A User's Guide to the Crisis of Civilization' (2010) and 'The London Bombings' (2006)