Listening to the Great Mosque Debate, you'd imagine that minarets and domes are about to rise on the exact spot where the Twin Towers stood – and that at the appointed hour, a muezzin's voice will soon ring out, summoning a city to bow to the faith of Mohamed Atta and his fellow hijackers.

The truth is a little different. Essentially, the New York authorities have given planning permission for a proposed Islamic cultural centre that, apart from a place of worship, will contain, inter alia, basketball courts, a restaurant, and babysitting facilities, as well as a memorial to the victims of 9/11. And all this is contingent on funding being secured for the project.

Moreover, the 13-storey construction would be two blocks away from Ground Zero. In a vast and variegated city, two blocks can feel like a dozen miles. But why let facts get in the way of a good story, particularly when it's election season and there is pandering to be done, prejudices to be stirred and votes to be won? American politics is often an unedifying spectacle. But rarely has it plumbed such depths as now in the midst of this typically news-less August.

Even so, were this merely a matter of party politics, the affair would not be so serious. The real risk is that it will reinforce the impression that the US, contrary to every assurance given since 9/11, is opposed to Islam, period. Which is precisely the argument of a certain Osama bin Laden.

Few here are making that point. But what are politicians elected for, if not to lead? The 2001 attacks were of course a ghastly crime, still raw in the public consciousness. But no one is asking America's politicians to commit professional suicide by playing down the atrocity of the event. All that is requested is a little honesty. Instead, especially if they are Republicans, they pander.

No one used to make the point more often and more emphatically than George W Bush that Bin Laden and the 19 hijackers of 9/11 did not represent all Muslims. The 43rd president's reputation these days may be much diminished, but a reminder from him now to this effect, apropos of the fracas over the mosque, would have been timely. Alas, from the memoir writer in Dallas, not a word – although, to be fair, some of his former aides have spoken out against the nonsense spouted by party "leaders" who should know better.

Setting an especially tawdry example, predictably, has been the ever-intemperate Newt Gingrich, the former speaker who is flirting with a 2012 presidential run. To go ahead with the project would be comparable to Nazis "putting up a sign outside the Holocaust Museum in Washington", he has declared, adding that there should be no mosque near Ground Zero so long as there are no churches or synagogues in Saudi Arabia.

Sarah Palin has also chipped in, tweeting to her followers that "Ground Zero Mosque is UNNECESSARY provocation. It stabs hearts."

Mitt Romney, a near-certain 2012 contender, has taken an ostensibly more statesmanlike approach, pointing to "the wishes of the families of the deceased", and the danger of the mosque becoming a recruiting ground for terrorists. In fact, victims' families are divided on the issue, with many arguing that the project should go ahead as planned.

This chorus of competing voices, of course, bespeaks the current disarray of the Republican Party, united only in saying "no" to anything proposed by Barack Obama and Democrats. But the enduring economic crisis seems set to hand them a resounding victory in November's congressional elections; if whipping up a Ground Zero controversy brings in even more votes, why not? And remember, this is a country where almost 20% of the population believe that Obama himself is a Muslim, according to a poll this week.

Sadly, the current president's performance has been little more impressive. First he supported the project, only to backtrack the next day. He had merely been talking about freedom of religion, he explained, "not the wisdom of the decision to put a mosque there".

Harry Reid, the Democrats' leader in the senate, who faces a tough re-election fight this autumn in Nevada, has also come out against the mosque as "not a good idea". Republicans do not have a monopoly of pandering.

Both Obama and Reid would have done better to repeat the sentiments of New York's mayor, Michael Bloomberg, the most eloquent defender of the project in its envisaged site – on the grounds of both freedom of religion and freedom of property.

"We would be untrue to the best part of ourselves, and who we are as New Yorkers and Americans," Bloomberg has said, "if we said 'no' to a mosque in Lower Manhattan."

That, incidentally, is also a defining difference between the open society of the US, and the intolerant Wahhabites in Riyadh.

Perhaps a compromise will emerge, and the centre will go ahead, but a little further away, so as not to stir sensibilities unduly. That solution is advocated by Bloomberg's Republican predecessor, Rudolph Giuliani; as the man who led the city through 9/11, Giuliani's views may be persuasive. But they would be a cave-in nonetheless.

For as David Ramadan, a Republican and an Arab-American, put it on public radio here the other day, "If two blocks is too close, is four blocks acceptable? Or six blocks? Or eight blocks? Does our party believe that one can only practise his or her religion in certain places, which define boundaries, and away from the disapproving glances of some other citizens?"

If that is the case, millions more Muslims around the world will understandably take the view that America believes that Islam is an inferior faith, to be circumscribed and marginalised. The extremists will indeed find new recruits, and the meaning of 9/11 will be eroded. For Ground Zero is indeed a place of unspeakable wickedness, but not a place of Christian martyrdom. Among the victims that day were 300 Muslims as well.