When the history of shibboleths comes to be written, the chapter on the 1980s will undoubtedly be entitled “The Free Market.” It will describe the adroit use of this slogan by a radically statist administration— the Reagan administration —to camouflage the most drastic redistribution of wealth in American history: from low- and middle-income taxpayers to high-income taxpayers and the defense industry. Its epigraph will be David Stockman’s famous remark about the corporate champions of free enterprise taking part in deliberations on the Reagan tax bill: “The hogs were really feeding at the trough.”

The chapter on the 1990s will probably be entitled “Diversity.” It will tell a more complicated story: of honorable zeal turned intolerant and self-serving of a generous impulse turned, as Richard Bernstein concludes sadly in “Dictatorship of Virtue,” “fake, fraudulent, superstitious, cranky, sanctimonious, monotonous.” Scarcely anyone would deny that the historic disadvantages of blacks, women and homosexuals deserve a serious, far-reaching public response. But scarcely anyone will affirm, after reading “Dictatorship of Virtue,” that multiculturalism has been the right response. Anyone, that is, except the “diversity” industry and the “diversity” bureaucracy, who, like their military-industrial forebears, have been feeding (albeit more decorously) at their own (much smaller) public trough.

Bernstein, formerly national cultural correspondent of “The New York Times”, here reports on curricular innovations, hate-speech codes, workplace sensitivity programs and other components of multiculturalism. Some of his case studies are of matters that have already attracted national attention: the New York State “Rainbow Curriculum”; the quincentennial of Columbus; Afrocentrism; the notorious freshman composition course, denounced by George Will, at the University of Texas in Austin. Others are news, to me at least, like the pitched battle a few years ago between parents and teachers at Brookline High School.

In these cases and a great many others in recent years, educators have tried to further racial and sexual equality by revising culture, or at any rate the version of it imbibed by students. They have de-emphasized, and sometimes disparaged, what were previously considered the central characters and events of world history and the highest achievements of world literature, replacing them with exemplary works and deeds by women, blacks and other long-subordinated groups. Employers and campus administrators have offered programs to sensitize workers and students to cultural differences and have devised verbal and behavioral guidelines to prevent racial or sexual harassment.

These are worthy goals, as Bernstein, a liberal, is at pains to acknowledge. “Most reasonable people, myself included, are willing to accept a degree of favoritism to black people and others who have been kept out in the past.” But the strategy has not worked. The textbooks and syllabi Bernstein examines sound awfully tedious and the “diversity-enhancement” programs pretty pedestrian, alternately dense with jargon and airy with inflated commonplaces. The problem with multiculturalist pedagogy, he observes, “is not that it is entirely wrong and useless. The problem is that ... far too much is made of a few useful insights. They are stretched too thin.” Like much feminist literary scholarship and deconstructionist theory, multiculturalism is less often outlandish or destructive (neoconservative fulminations notwithstanding) than trivial and dull.

Mediocrity, however, isn’t the half of it. The title of Bernstein’s book alludes to the Reign of Terror during the French Revolution, a time of ideological acrimony, unbridled censoriousness and the indiscriminate politicization of culture and everyday life. In these respects (though fortunately on a smaller scale), and in a corresponding sullen, cowed conformism, contemporary American education, Bernstein contends, is similar. Skepticism is usually in order nowadays when it comes to charges of “political correctness,” since neoconservatives have so often cried — screamed — “wolf.” But there’s abundant documentation in “Dictatorship of Virtue” of petty tyranny by campus activists, aided and abetted by spineless university administrators. (One particularly sad example comes from just over the border, at the University of New Hampshire in Durham.) It’s not McCarthyism, but it’s bad enough.

This is the frustrating and apparently puzzling thing about multiculturalism: that a movement to open up, shake up and bring together has spawned so much mistrust, isolation, opportunism and bureaucratic miasma. Perhaps it’s no great puzzle; reform movements have always been used by some people as career vehicles. “A bureaucracy, once it exists, finds reasons to perpetuate itself. The school-revolution bureaucracy is no exception,” Bernstein remarks dryly. So the rhetoric of “difference” and “oppression” escalates. Mean while students, especially poor and minority students, emerge from schools and colleges more than ever at the mercy of mass culture and a fickle global economy.

“Dictatorship of Virtue” is a depressing book, though that’s not Bernstein’s fault. His writing is sometimes tart, sometimes eloquent, always graceful and lucid. His reporting is fair and thorough. His judgments are harsh but not mean-spirited. Reading the book is arguably a civic duty. But it does, now and then, bring to mind Yeats’ gloomy lines: “The best lack all conviction, while the worst / Are full of passionate intensity.”