Kevin Rudd has put religion back on the political agenda, at least as far as the op-ed pages and serious talk shows are concerned. But there was a time when religion played a more incendiary role in the nation's politics, and Australians, especially Catholic Australians, were for a long time desperate to separate the two.

In the aftermath of the Great Split in the Labor Party, in 1954-55, the Catholic-based anti-communist wing was driven out of all the states, other than New South Wales. The anti-communists, led by Bob Santamaria, then received the cold shoulder from Rome. They soldiered on, forming one of the most determined political forces in Australia. Through his organisation, the National Civic Council, and his newspaper column, his TV spot on the Nine Network and his regular contact with government ministers, Santamaria exerted the kind of influence which political activists and lobbyists these days can only dream of.

Much of the story of this battle is reflected in the letters of Santamaria to his friends and contacts over a period of almost 60 years. The editor of Your Most Obedient Servant: Selected Letters 1938-1996 (Miegunyah Press, 590pp; $49.95), Patrick Morgan, and the Santamaria family are to be congratulated for having published this correspondence, which is of immense political and historical interest.

There is nothing quite like someone's private confidences as a source of hard evidence, and the letters contain plenty of material that the many enemies of Santamaria could use to damn him, for once and for all. His plans to penetrate the Labor Party and to use it to promote his favoured religious and social order are unequivocal. The various organisations which he led are revealed as manipulative, secret, quasi-intelligence bodies. He also saw no contradiction in using Catholic charitable funds (Project Compassion) to fund a conservative political party in Vietnam and then denouncing others in the church for using the same source to fund progressive, less blatantly political causes.

Reading the letters from the early '50s, you become aware that many on the Australian Right felt that a third world war, this time against communism, was a possibility. They believed that Australia's survival as a nation was on the line, and this justified all kinds of extraordinary measures. One was an attempt to take over the ALP: in a letter to Archbishop Mannix in 1952, Santamaria predicted that his organisation "should, within a period of five to six years, be able to completely transform the leadership of the Labor Movement".

But the revelations about the Whitlam years are, for me, the most surprising part of the book. Patrick Morgan's commentary reveals musings by Santamaria which have the distinct whiff of a populist coup. In the chaotic days of 1975, as the Whitlam government lurched from crisis to crisis, Santamaria discussed with close contacts whether a certain "plan" was being realised. This involved the creation, in Santamaria's words, of a "supra-political organisation ... to defend the parliamentary system and the rule of law against violence". The National Movement, as he termed it, could, "if the urgent necessity arises ... be available for any emergency action and may decide to alter its non-political orientation and assume political responsibilities". Variants on the plan had existed since the middle of 1972, as radical left-wing action, in Santamaria's mind, was eroding Australian democracy. That such a fantastic notion of "emergency action" to save the nation should arise has eerie echoes: plans by the Right for similar action were prepared under Labor in the Depression and in the postwar period.

So, if nailing Santamaria is your aim, there is ample ammunition in Your Most Obedient Servant. But the letters also offer insight into the mindset of those whose views verge on fanaticism. People become fanatics, a perceptive friend once told me, because they passionately want the best. They are romantics and idealists; they care deeply. Like many of his communist adversaries of the Cold War era, Santamaria was a blend of the romantic and the ruthless. He cared about the future; he cared about principle; he cared about what was right and what was wrong. He was an idealist with a streak of fanaticism, as were his opponents: so many of his assumptions, plans and methods mirror those of the leftist enemy he fought.

Yet fanaticism is not the sum of Santamaria. The letters reveal a man with a dry sense of humour, a man who genuinely cared about his friends, a person prepared to help ordinary people in need who sought help through his political influence.

As you read the letters from across the decades, you see Santamaria's world dissolving in ways that demoralise and frustrate him. The Right, which was once built on anti-communism, undergoes a transformation, not just because of the disintegration of the powerful anti-communist coalition after the collapse of the Soviet Union, but also because of the rise of militant economic liberalism as the new defining ideology of the Right.

Economic liberalism, pioneered by Margaret Thatcher, was a radical challenge to Santamaria because he was a consistent collectivist at heart. On social matters, his collectivism was expressed in a desire to uphold a set of conservative social norms centred on sex and marriage. On economic matters, his collectivism favoured decentralised rural development as the ideal foundation for society. While he eventually abandoned this, he always retained a critique of industrialism, consumerism and individualism which put him at odds with the rise of economic rationalism. In turn, this meant he inveighed against the privatisation of government institutions, the easy money which came with financial deregulation, and what he called "the cult of instant gratification" - all of which now has a familiar resonance for people often described as left-wing.

Santamaria's later demoralisation was not due solely to the selfishness promoted by economic liberalism. From the '70s, the Catholic Church in Australia was undergoing a renewal - as he saw it, a degeneration - which horrified him. For many years, Santamaria organised his large, sympathetic cohort of priests and church-goers to resist this tide and attack his enemies. At the heart of his commitment was his faith. Yet in 1990, he said in a letter that "my retention of Catholic belief ... is a constant struggle over an innate scepticism."

Perhaps for these reasons, the later letters frequently voiced what Patrick Morgan calls Santamaria's "persistent cry near the end of his career that he had been a failure". In part, this was a kind of studied humility and self-deprecation - something present in most of the correspondence in Your Most Obedient Servant - but it also reflects a view that communism somehow won after the '70s. What he meant was that a certain kind of cultural libertarianism had triumphed. This is doubly ironic, because this libertarianism also helped to undo the class-based collectivism that defined his enemies.

Toward the end of his life, there was reconciliation of a sort. Old enemies in the ALP sought him out, perhaps sentimental about the old days but mostly sensing Santamaria's deep criticism of economic rationalism and the changes it had wrought. His life thus described a circle: in the wake of the Depression, Santamaria named capitalism as the enemy; by the '90s, he was again worried by a new kind of unrestrained capitalism which sanctified greed and individualism. He might even have found allies on the Left and elsewhere, but by that time the man and his activities were thoroughly isolated. The circle, therefore, was never closed.