LONDON— In Baghdad in the ninth century, a much happier age than now, there was an area known as the Suq al-warraqin, the Stationer's Market. Lining its streets were more than 100 shops selling paper. Baghdad was an important center of paper making and, for the Byzantines at least, its products were the best. They referred to paper as ''bagdatixon'' and the standard size, roughly 29 inches by 43 inches, was known as a Baghdadi sheet. There were many different types, usually named after the city's rulers and governors of its provinces: Talhi paper, Nuhi paper, Tahiri paper. Paper was the new technology, and the Arabs were the masters.

The fighting in Iraq was only the latest event to widen the gulf between the West and the Arab world. Many Muslim fundamentalists are unlikely to reconcile themselves to Western ways ever again. But for the more reasonable middle ground, the reconciliation cannot begin quickly enough. That is where history -- and paper technology -- comes in.

Fundamentalist Muslims are fond of referring back to Baghdad's ''golden age,'' when its civilization shone more brightly than any other, when its philosophers, mathematicians and doctors led the way intellectually. Sometimes wistfully, often angrily, but without really thinking it can ever happen, they yearn for a return to the golden age. Without it, we are invited to believe, the disparity between the West and Islam can lead only to, well, we all know where.

Before Saddam Hussein's defeat, images across Iraq portrayed him in the garb of Al Mansur, the caliph who built Baghdad. At the Hunting Club, founded in the capital by Saddam Hussein, the decorations were dominated by ancient silk headdresses from the 9th and 10th centuries. Speaking to his troops in January, the dictator said, ''If anyone attempts to intimidate you, the people of Iraq, repel him and tell him that he is a small midget, while we belong to a nation of glorious faith, a great nation and an ancient people who have, through their civilization, taught the human race as a whole what man was yet to know.''

He was not the only Arab fanatic to see the past within the present. There is a direct line back from Osama bin Laden to Sayyid Qutb, the founder of the Egyptian radical group that assassinated President Anwar Sadat in 1981. Qutb made no secret of being influenced by Ibn Taymiyya, a 14th century clerical jurist whose violent views about Islam were provoked by his own family's having to flee Baghdad during the Mongol invasions. Sayyid Qutb said that history is ''a memory determined by the authority of the foundational age of Islam.''

Maybe. But, in a spirit of reconciliation, some plain speaking. The reality of Islam's golden age was very different from the fundamentalist ideal. These differences show that any move toward that ideal is likely to thwart an Arab renaissance, which is probably the greatest guarantee of enduring peace.

Take paper. It was a Chinese invention of the first century A.D. Whether or not you accept the traditional Western view -- that it reached the Middle East via the Battle of Talas (near Tashkent) in 751, when some Chinese paper makers were captured -- or if you believe it had arrived via the Silk Route much earlier, the fact remains that it was the Arabs who raised paper making to new heights. And their achievement was not just technological; the sheer abundance of paper helped create a new raft of educated people. In some Middle Eastern schools in the ninth century, the paper was free.

So too in many other areas of life Baghdad became the Tokyo of its day. Many of the ideas it snapped up were foreign. Yet the Arabs adapted them brilliantly. The hospital was a Persian idea from as early as the sixth century, under the name ''bimaristan.'' But in Baghdad the institution became much more sophisticated, with special wards for internal diseases, contagious cases and psychiatric patients. Field hospitals accompanying Arab armies were also introduced.

The pattern was repeated in mathematics. In the late eighth century, an Indian merchant brought to Baghdad two seminal mathematical works. One was the Brahmasphuta Siddhanta, known to Arabs as the Sindhind, the work of the great seventh-century Indian mathematician Brahmagupta. This contained early ideas about al-jabr, to give algebra its Arabic name. It was this work that Muhammad ibn-Musa al-Khwarizmi in the ninth century was to expand on so successfully. Khwarizmi became known as ''the father of algebra'' and gave his name to algorithms.

The same Indian merchant also brought a manuscript that introduced for the first time outside India the nine Hindu numerals we use to this day and are now called Arabic numerals. (Before that, numbers were written out as words or notated with letters of the alphabet.) This document also contained the first mention of the 0, which the Arabs called zephirum, from which our words zero and cipher are derived. But again, it was the Baghdadis who built on these imported innovations, to create what one historian of mathematics has called ''the Arabic hegemony.'' In addition to Khwarizmi, this group included Ibn Turk, al-Karkhi, al-Biruni, al-Haytham (called Alhazen in the West), Nasir Eddin and Omar Khayyam (he of ''Rubaiyat'' fame).

Finally, Aristotle. As a pagan, he posed a problem for Muslims -- as he did for Christians a couple of centuries later. Nevertheless, the power of his ideas triumphed, and a whole slew of Arab ''falasafahs'' were influenced by Aristotle -- al-Ghazali, Ibn Sina (Avicenna) and Ibn Khaldun among them. In addition, al-Farabi glossed Plato, al-Rhazi (Rhazes) built on Galen and Hippocrates, and Ibn Qurrah added to Euclid and Archimedes.

The point of this history is to show how the golden age that Arab fundamentalists refer to was achieved only because Baghdad was wide open to foreign influences, much as the United States at its birth imported ideas of the Enlightenment from Europe and made more of them than did the Old World.

One can go further. Many of the scholars who translated the manuscripts of the Greeks, Indians and Chinese, and who flocked to Baghdad in the golden age, were Christians, Jews and pagans. Although the West as we know it didn't exist in the 9th and 10th centuries, one could say that the Arab world was, for a time, part of the intellectual circle that would become the West. Many of the Greek classics reached Europe via Muslim Toledo, in Spain, where they were translated from Arabic into Latin.

In other words, there is no need for the Arab world to fear the West -- or to despise it, for that matter. If Arab history is any guide, more prosperity comes from openness, receptivity and curiosity than from the closed, self-referential world of fundamentalist religions. One of the reasons the golden age happened was that the natural sciences and the so-called Islamic sciences (or religious study) were kept separate in the colleges of the day. It seems no coincidence that only when the religious authorities started to interfere with the natural sciences, starting in the 11th century, did the golden age lose its glitter.

Historically, the place we now call Iraq has always been the most secular of Arab states. That is a precious asset. Whatever government follows Saddam Hussein, it must continue to turn its face against fundamentalism. The acrimony last week between imams and secular Iraqis at meetings on the shape of the new Iraq was worrisome, if not surprising. Unless the next Arab generation, in Iraq and elsewhere, embraces the intellectual openness that so characterized the Baghdad of the 9th and 10th centuries, a second Arab miracle is unthinkable.

Drawing (Tim Robinson)