The book tells the story of Ted Mundy, a Pakistani-born Briton who as a student becomes proficient in the German language. He joins a 1960s-era student protest group in West Berlin and becomes a lifelong friend of a West German student anarchist named Sasha. Having been brutally beaten by West Berlin police and ejected from Germany, Mundy fails at several careers, as a teacher at an English prep school, as a newspaper reporter, a radio interviewer and a novelist. Eventually Mundy obtains a position with the British Council. Meanwhile, Sasha has defected to East Germany to become a member of the notorious Stasi secret police. On a trip to East Germany with a youth theatre group, Mundy and Sasha meet again. By this time Sasha has become totally disillusioned with the Communist Bloc and enlists the naive Mundy to become a double agent. Sasha has access to state secrets and he recruits Mundy to help him smuggle them out of East Germany and deliver them to MI6, the British Secret Service. Their efforts contribute to the collapse of the GDR and eventual destruction of the Berlin Wall.
Later, Sasha and Mundy once again conspire in grandiose schemes to combat American military and industrial globalization. The two ideologues become pawns of the group they thought they were combating. After they are killed, they are portrayed as terrorists "with connections to Al-Qaeda", in efforts to convince European governments to support the United States in its "war on terror". After Mundy's death, Amory, his controller from the British intelligence service during his espionage years, tries to publicize the truth, but slander by the British government results in his story being totally discredited. The novel is a chilling reminder of the ability of governments and groups to manipulate public thinking to achieve their private ends, and underlines the need for people to not simply believe what they are told/sold without question.