Broke by David Boyle and When the Money Runs Out by Stephen D King: The broken mirror of money

Finance, like fiction, needs a narrative. Money being a belief system - it is always possible to believe our way out of a crisis.

Broke: Who Killed the Middle Classes?
by David Boyle
Fourth Estate, £14.99, 352pp 
 
When the Money Runs Out: the End of Western Affluence 
by Stephen D King
Yale University Press, £20,  304pp

Money is a mirror. When we are happy, it dances, sings and races round the world. When we are frightened, it flees, trembling, seeking a place to hide. When we are sad, it sinks into dark, melancholy pools of mistrust. We are, according to Stephen D King, now sad and money lies inert, indolent.

Those who once gazed most confidently in the mirror of money, the middle classes, dare not look. Their pensions have shrunk; their children cannot afford a home; their hard work, their talents and their qualifications earn them next to nothing compared to the City shysters, while their small businesses pay taxes that are gleefully evaded by foreign multinationals. They are, according to David Boyle, dying.

These two very different books, as their titles suggest, say the same thing – that the financial crash did not just happen in 2007- 2008, that it is an ongoing cataclysm, a melancholy pool in which the west is drowning, that we are broke, that there is no more money. Worse still, there are, as King writes in When the Money Runs Out, no solutions on offer. Since the crash, we have been locked in a sterile political confrontation between two recovery strategies, neither of which can be expected to work. Austerity chokes off growth; increased government spending threatens to plunge us into a Greek-like crisis. The odd thing is that both of these strategies have worked in the past but neither can work now. King’s book explains why.

Boyle is in his mid-fifties. He looks back to the warm, value-laden, functioning middleclass world in which he was brought up from the perspective of the cold, dysfunctional present. Perhaps even then people were standing on a cliff edge but at least they did not know it. Now, they all know it and, indeed, they may already have fallen.

Are these grim diagnoses correct? First, we have to allow for the specialist perspectives of the authors. King is the group chief economist at HSBC and, throughout the book, he understates, occasionally wildly, the role of banking delinquency in creating the appalling collapse of trust that is intrinsic to our current economic stagnation. Boyle is a business writer and policy adviser; he is very middle class and – he admits to this – somewhat too nostalgic to be entirely objective. Neither of these problems is serious but readers should be aware of them.

Both books argue that we have reached the climax of a process that was, until now, largely benign. For Boyle, the middle classes provided enterprise and sound, if occasionally suffocating, values. King writes that the postwar period generated wealth on an unprecedented scale. Unfortunately, failures were implicit in these successes. The middle classes mortgaged their futures and fell for transparent scams, while the new wealth inspired a growth-dependent entitlement culture that was unsustainable in the face of an economic reversal in which growth appears to have stalled.

Boyle’s approach is brisk and somewhat arch. The question in his subtitle – “Who killed the middle classes?” – marks the start of “a detective story” on which we embark with our “deerstalkers and magnifying glasses”. Happily, this heavy conceit is not sustained and safely ignored. What follow are six “clues” – house prices, banks, the financialisation of the economy, pensions, education and the declining role and status of the professions.

He tells these stories, on the whole, persuasively and with some startling asides. Victorian economists, for example, worked out that the average peasant in 1495 needed to work 15 weeks a year to sustain his way of life. By 1564, it was 40 weeks and, now, it is common for both husband and wife to have to work flat out for almost the entire year to keep themselves afloat. Yet we are so much richer, or so we are told.

Perhaps more pointedly, Boyle does some convincing unpicking of policy decisions made over the past few decades. I, for one, had entirely forgotten about the “corset”, a system that existed until the 1980s for restricting bank lending and that, therefore, kept the banks out of the mortgage market. It was dispensed with in the Thatcher years and this, combined with the new money pouring in after the “Big Bang” opened the City to the world, led to a flood of new money for mortgages. House prices soared. If, Boyle observes, houses prices had stayed steady since he was born in 1958, the average price would now be £43,000. It is, in reality, closer to £250,000.

Boyle also reminds me of the Lloyd’s insurance market scandal of the 1980s and 1990s. A few middle-class types had been persuaded to become “names” – investors – in Lloyd’s on the basis that it was a rather grand and very secure home for one’s savings. Unfortunately, being a name meant that you accepted unlimited liability, so when incompetent underwriters steered the business into a series of appalling losses, the middle-class investors were wiped out, homes and all.

The grandees – financial, political and legal – took the side of the City against the investors and thus established the precedent that money was more important than people. As a result of that decision, bankers remain free to gamble with our savings with the same dud equations and the same ruthlessness that led to the crash.

Such histories are interspersed with anecdotes that will probably be familiar to us all: a lawyer struggling to survive in London on £100,000 a year, double-income families forced to spend every penny and leave nothing aside for pensions, professions eviscerated by the algorithmic demands of head office, small businesses destroyed by bureaucracy and robotic banks, desperate struggles to land a place at a decent state school – the private schools having, like the fancy design labels, priced themselves out of the reach of even the higher-income earners.

For the middle classes (and that seems to be about 60 per cent of us), Britain is a worse place than it was and, for their children, it is likely to be even worse. What is to be done?

Boyle’s answers begin from the premise that, to a large extent, the middle classes are the architects of their own misfortunes. For example, they scooped up the buyout money that destroyed the building societies and left us with a dishonest and inept banking system to finance our homes. They are guilty of not paying attention, of not doing what they do best: organising their affairs.

And so, like any good self-helper, Boyle ends with a 12-point programme for the middle classes: accepting the reality that the financial economy is not on their side, being entrepreneurial, buying and being local, avoiding debt, retiring later, starting their own schools, and so on. This, he says, is what they did in the past and it usually worked. But can it this time?

“Probably not” will be your answer if you read King’s When the Money Runs Out. Although, as I say, it is broadly about the same subject as Boyle’s book – the persistence of the economic catastrophe – it could not be more different. Apart from letting the banks off too lightly, King is a tough-minded economist and his approach is analytical and brilliantly educational, though you might wish you hadn’t learned some of the stuff in these pages.

Our problem, to simplify matters, is twofold. The west has created “entitlement” economies, which are predicated on continuing growth. We take this growth for granted, while ignoring the lessons of two once-booming economies – Argentina and Japan – which, suddenly and quite unexpectedly, stopped growing. This stagnation is not the same as a crash. It does not inspire terror but rather, as Adam Smith put it, melancholia.

This leads to the second part of the problem. In stagnation, nothing much happens and neither stimulus nor austerity – the twin poles of our current debate – works. There is no Plan C precisely because we have become so convinced that a swift return to growth is always inevitable.

The awful possibility is that the west as a whole has gone ex-growth and, as a result, we may have to change our entire way of life. It shouldn’t be that difficult. Continuous growth has, after all, only been a phenomenon of the past 250 years. But it is a nightmare and King will not, until the very end, let us wake up. He simply knocks down every economic device and every financial trick that, at one time or another, we have been told would save us from poverty. He is particularly withering about quantitative easing, which he describes as “a morally indifferent Robin Hood . . . chaotically redistributing income and wealth using neither rhyme nor reason”.

There are too many entertaining but depressing examples to list here. Instead, I will focus on the book’s greatest strength, which is its clear sense of the role of belief or, if you prefer, psychology in the working of the economy.

“In reality,” King writes, “the financial system prices beliefs – and beliefs about beliefs – not ultimate truth.” This is a particularly important insight during a period of melancholic stagnation. At such times, every game becomes zero-sum, every action produces winners and losers and trust drains away. We end up fighting over the spoils.

Furthermore, melancholia destroys the possibility of united action to save ourselves. Money being a belief system, it is always possible to believe our way out of the crisis. King points to the way people in some Asian countries simply accepted the reality of their crisis in the 1990s and meekly put up with huge cuts in their standard of living. As a result, their economies bounced back. They had a story to tell themselves, of mutual responsibility and concerted action. “For the west,” King observes drily, “there is, as yet, no narrative.”

Like Boyle, he ends with proposals that might work. We should, for example, treat debtors and creditors as equally at fault – Germany is not the virtuous man of Europe for the simple reason that it lent money to the south in the first place. There should also be a “new social contract between the generations”. The baby boomers have lived well off the future earnings of the young; that cannot happen again.

There are many more ideas but the attempt to find a story to justify the sacrifices necessary for recovery is the foundation of them all. It is this that joins these two books. Boyle is attempting first to evoke and then to restructure the old story of the busy, sane, thrifty and inventive middle classes in the melancholy pools of the 21st century; King is attempting to wean us off the tales – or fantasies – of inevitable and unending growth. Neither is certain of success, because the hard truth may be that the crash marked the beginning of the end of the story of western success. We may never look with satisfaction in the mirror of money again.

Bryan Appleyard’s latest book is “Bedford Park: a Novel” (Weidenfeld & Nicolson, ebook, £3.99)

Safe as houses? Though the west expects a swift return to growth, it is far from inevitable. Image: Daniel Stier Title: "The Frontier House".

This article first appeared in the 03 June 2013 issue of the New Statesman, The Power Christians

Photo: Getty
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The New Statesman 2016 local and devolved elections liveblog

Results and analysis from elections across the United Kingdom. 

Welcome to the New Statesman's elections liveblog. Results will be coming in from the devolved legislatures in Scotland and Wales, local elections in England, and the mayoral contests in London, Salford, Bristol and Liverpool. Hit refresh for updates!

05:02: Blimey, Leanne Wood has defeated Leighton Andrews, a (former) Labour Cabinet minister in the Rhondda, turning a Labour majority of 6,000 in 2011 to a Plaid Cymru one of over 3,000. 

04:57: At time of writing, Labour has lost ground in England, Wales and Scotland. But just as the party proved more resilient in bunkering down against David Cameron in 2010, they've done a great job of defending councils tonight. Labour's machine, turns out, is much better at defensive campaigns - see 2010 and 2016 - than offensive ones - see 2015. Just a half-formed thought. I'm quite tired. 

04:56: Nicola Sturgeon has been re-elected in Glasgow Southside.

04:53: In Liverpool, Joe Anderson has been re-elected Mayor of Liverpool with 52 per cent of the vote. 

04:48: Labour have held Norwich, making gains at the expense of the Greens. They have kept control of Wakefield, too. 

04:47: Labour have held Dumbarton by just 100 votes. 

04:44: Scratch that. Labour have two seats. They've just won Edinburgh Southern from the SNP. 

04:40: The scores on the doors across the country.

In England, Labour have won 727 seats, a net loss of 29. The Conservatives have gained seven seats, winning 425 overall. The Liberal Democrats have won 166 seats, gaining 10 seats. Ukip are up 20 seats to 28 seats. Labour are holding on to power in individual councils but losing councilors.  

In Wales, after 22 seats have been counted, Labour have 16 seats, Plaid Cymru have 3, the Conservatives have 2 and the Liberal Democrats have one. No seats have changed hands - yet. Labour are on course to remain in power and may well get the 28 seats (they need 31 for a majority of one) to form an effective minority administration.

In Scotland, with 27 seats declared, the SNP are on 21 seats, having gained two overall, the Liberal Democrats are on three seats having gained one, the Conservatives are on two seats having gained one, while Labour have won seat having lost four overall. The Conservatives are on course to finish second. 

04:34: Peter Hain is on air saying that these results aren't good enough at this stage in the cycle. Historically and psephologically, he's right, but the Corbyn bench should surely be deep enough that this isn't happening. Where's my own MP, Diane Abbott? Or Cat Smith, Clive Lewis, Kate Osamor, etc? 

04:30: Blimey. Liberal Democrat leader Kirsty Williams has just won re-election in Brecon & Radnorshire with a margin of victory that Vladimir Putin would consider excessive. 

04:26: I keep meaning to do a scores on the doors but too much stuff is happening, apologies. The Scottish Conservatives have won Aberdeenshire West from the SNP. 

04:21: Ruth Davidson has won in Edinburgh Central. She will not need to enter Holyrood through the list system, she is the first Tory leader in Scotland not to need the list since 2005 - and she will surely be the first to serve as official leader of the Opposition. 

04:16: In Edinburgh Eastern, Scottish Labour leader Kezia Dugdale has failed in her bid to unseat the SNP's candidate, Ash Denham. She'll be back on the list system. 

04:12: Stasis seems to be the word of the day in Wales. Ukip have gained seats (remember they weren't really a thing when the Assembly was last fought in 2011) but have produced a carbon-copy of their 2015 performance. The Conservatives look likely to stay in second place, while Labour look well-placed to keep on keeping on as a minority administration. 

04:11: People are asking me what the swing to Labour in Ogmore is. It's zero. Exact stasis. 

04:08: Labour have held Exeter

04:05: The SNP have lost Edinburgh Western to the Liberal Democrats. 

04:00: For those of you just joining us. In Scotland, the SNP will not get a majority in Holyrood through theconstituency elections, it appears. They look likely to get one through the party list but that is by no means certain. However, they are on course to get close to 50 per cent of the vote. Scottish Labour and the Scottish Conservatives are in a bare-knuckle fight for second place, with the Tories the favourites. One minister has texted to tell me they are "certain" Ruth Davidson has got them second.

In England, Labour is losing councillors overall but is holding ground in terms of controlling councils - and is making gains in some by-elections. A murky picture.

In Wales, Labour is on course to remain the largest party with a slightly smaller number of seats. An open question has to what deal they will end up striking to remain in power there.  

03:53: Direct projections from local elections to national are tricky things, as the incumbent always recovers (presumably a section of the electorate thinks "Hey, they haven't killed us yet!"). Projections from the final set of locals from the 1992-7 parliament put the Tories under 100, projections from the final set before 2010 put Labour in third place. That said, they are fun: 

03:52: Labour has lost Edinburgh Northern and Leith to the SNP. 

03:47: A rare changing of the guard in a night of stasis in England - Dudley goes from Labour-run to No Overall Control, though Labour remains the largest party. 

03:43: Biggest losers so far: Scottish Labour and the Welsh Conservatives, who appear to have gone backwards.  

03:41: Hearing the Conservatives have won Dumfriesshire from the SNP. 

03:36: It's been a bad year for Brown's heirs. We've had Ed Balls and Douglas Alexander lose her seat, Yvette Cooper get crushed by Jeremy Corbyn and Ed Miliband repudiated by the voters. Would make a good play. 

03:31: One I missed. Alex Rowley, Gordon Brown's old constituency manager and protégé, has lost his seat in Cowdenbeath, though he is likely to return to Holyrood thanks to the list vote. 

03:30: Golly Ms Molly! Iain Gray has survived in East Lothian - the SNPmageddon isn't quite what we forecast. In Wales, we have just four results in - and Labour has won them all. 

03:27: "That ain't gonna happen," says John Mann of a coup against Corbyn. Probably the most important thing you'll hear tonight. 

03:25: Blimey! The Liberal Democrats have won Fife North East from the SNP - its boundaries largely that of Ming Campbel''s old seat. 

03:19: Labour have held the marginal seat of Southampton

03:18: You can't keep the Bradshaw machine down. Labour has made gains in Exeter and will keep control. 

03:15: In Scotland, the average Labour to Conservative swing is 10 points. 

03:10: The Conservatives have held Ayr. The SNP look likely to get a majority but the possibility of an SNP-Green deal looks entirely plausible. 

03:00: For those of you just joining us. In England, Labour have won 527 councilors, a net loss of 26. The Conservatives have won 292 seats, a net gain of eight seats. The Liberal Democrats have won 105 seats, a net gain of five seats. Ukip have won 23 seats, a net gain of 17. The Greens are up one and have won five seats. Labour have won two Westminster by-elections in Sheffield Brightside and Ogmore. In Wales, Labour remains the largest party but whether they will govern alone or in coalition remains to be decided. In Scotland, the SNP are on course to romp home with around 50 per cent of the vote. The Conservatives and Labour are in a dogfight for second place. 

02:50: Labour have held Crawley, with an increased majority. 

02:45: The Liberal Democrats have won every seat that is up for election in Southport

02:42: Been remarkably little movement of council control so far tonight. Considerable churn in terms of losses here and gains there, but just one council has changed hands - Stockport, which is now Labour-dominated having been Liberal Democrat run. In Worcester, the Conservatives have lost their majority. 

02:40: Labour are upbeat in Crawley

02:38: Labour have gained a seat from the Greens in Norwich and there may be more gains to come tonight. Local sources are fairly positive. 

02:35: What we know so far: In England, Labour is having a better night than the early results suggested, though they are losing votes. Outside of Scotland, Ukip are up most everywhere but are doing particularly well in Wales. In Scotland, the SNP are picking up seats and the Conservatives look on course for second. 

02:34: The government's not changing in Scotland, but it looks highly likely we will get a new opposition - the Conservatives are heading for second if this swing keeps up. 

02:29: Now we're cooking with charcoal! Labour have lost Eastwood - the home of Scotland's largest (slash only) Jewish community - to the Conservatives. There is a real Livingstone effect in the Jewish community tonight - and it could yet hand Sadiq Khan a shock defeat in London if low turnout makes the result closer overall. 

02:26: Just a historical note on Sheffield Brightside. The party's vote share is up 5.8% there. It was up 7.3% in Oldham West. Later tonight we'll get Ogmore in, so we'll have the first three by-elections of the Corbyn era. In the first three of Ed Miliband's, all of which occured in 2011, Labour were up 10 points in their first three by-election holds. If there's a lull later I'll take a look at Cameron, IDS, Hague, Blair, etc. 

02:19: The Liberal Democrats have held Shetland

02:17: Labour's Gill Furniss holds Sheffield Brightside for Labour, defeating Elmo in the process.

02:15: The Liberal Democrats have held Eastleigh. Perhaps that Liberal Democrat revival is on after all?

02:11: Oh me, oh my. Labour have won Edinburgh Southern from the SNP. 

02:10: Three more marginals that look good for Labour: RochdaleSouthampton, and Crawley. The Liberal Democrats have made seven gains in Hull - a net gain of two. 

02:06: For those of you just joining us: in Scotland, the SNP are on course for a majority, while Labour and the Tories are in a close-fought battle for second place. In Wales, Labour remains short of an overall majority but will return to government. In England, Labour's vote is falling on 2012 but the party is making good holds in marginals declared so far. 

02:01: The SNP hold Hamilton and Larkhalll as expected - but no change in their vote. A five per cent swing from Labour to SNP but crucially what looks to me to be a swing from Labour to the Conservatives of eight percent. It's anyone's game in the battle for second-place. 

01:57: That point I made earlier about a Livingstone effect in Bury. Labour are increasingly certain they are, as one source puts it, "fucked" in Prestwich, and they look likely to go from first place to third in Eastwood, which holds around two thirds of Scotland's Jewish population. Greater Manchester and Eastwood are the only places outside London where the Jewish vote is concentrated enough to do big damage to Labour tonight, though there are a few wards in Leeds (not up to tonight) where things could also get dicey. But it will add to the jitters around some in London, already spooked by low turnout.

01:54: Labour retain control of Hastings. In Wales, Labour are confident of holding Llaneli, a marginal they and Plaid Cymru have scrapped over since its creation. 

01:52: Labour hold Harlow, another key marginal. 

01:47: Scores on the door: Labour have won 293 seats tonight so far, a net loss of five. The Conservatives have 114, a net gain of 6. The Liberal Democrats are down four across the piece and have 38. Ukip have 14 so far and have gained 11. The Greens have 2 and have made no net gains. But there are many, many more still to declare. 

01:45: Every time I say something positive about the Liberal Democrats they do a little bit worse. They've just lost Stockport to Labour. 

01:41: The Ken Livingstone Effect? Labour have just lost Sedgely in Bury, where Prestwich's Jewish population is heavily concentrated. Looks like a 20 point increase in the Tory vote there and Labour expect to lose the other seat that is up in Prestwich, which has a smaller but still significant Jewish population. Watch out for how Labour do in Finchley and Barnet when London counts tomorrow. 

01:40: The Liberal Democrats are confident of holding Shetland and increasingly chirpy about Edinburgh Western. A Labour Glasgow councilor is in a cheerful mood: "People on the doors are no longer angry, which gave the impression that things were starting to shift. Actually, it's a sign we're pitied, and no longer feared."

01:35: The Liberal Democrats are having something of a mare in Stockport, where their council leader has lost her seat to Labour. Although the council is notionally no overall control it is Liberal-run. Elects in thirds so will be tricky for anyone to get control there. 

01:33: A good hold for Labour. They are still in charge in Stevenage, a seat they must win in 2020.

01:27: A thought. The BBC is kind of going for a "Labour leadership says this would be a good figure. His critics say something else. Who is right?". That helps the party leadership, even though, to be frank, the baseline the Labour leadership wants to use is too low to be a useful yardstick. But mostly, the BBC's focus on balance hurts Labour. Cf. "Economists disagree over George Osborne's economics", which of course they do. It's just as that the division is not as finely balanced as Osborne would like to suggest. 

01:23: Labour are pretty confident that they will win Edinburgh Southern from the SNP - most of which mirrors Ian Murray's Edinburgh South seat. If you've never been, it is basically the plushest part of Edinburgh. It's as if Labour had been reduced to just one seat in London - and that seat was Kensington. 

01:21: Results from Glasgow and Fife indicate a third-placed finish is on the cards for Labour. 

01:18: Ukip look likely to be the largest party in Thurrock, and are making gains in Basildon too. 

01:15: You'll be shocked to hear that Labour's Joe Anderson is on course to be re-elected as Mayor in Liverpool. In Edinburgh, Edinburgh Western remains a good chance for the Liberal Democrats while Edinburgh Southern remains hopeful for Labour. (I'd like to apologise in advance for getting these two seats mixed up at some point around 4am.) 

01:10: A word from the Local Government Information Unit (LGiU) who are kindly assisting me with keeping track of the results.  Their Chief Executive, Jonathan Carr-West, has this to say about the results so far:

“The main focus so far tonight continues to be the Labour vote and what it tells us about Corbyn’s leadership. Many Labour councils who have very different political outlooks from the national leadership may feel aggrieved by this relentless focus on the national: especially if, as is likely, it is costing them votes. This will exacerbate the rift that already exists between a radical leadership and a pragmatic local government base.
So far, Labour are holding safe councils (Newcastle, Liverpool, Sunderland and Halton) - but we expect to see them losing significant numbers of seats as the night progresses. To put this in context, the last time these councils were contested Labour gained 823 seats.

We’re also looking at a Labour wipe out in Scotland and losses in the Welsh Assembly. While a Khan victory will be spun as the story of the night, the reality is that no opposition has lost councils seats in this way for thirty years.”

01:04: For those of you just joining us. In Wales, Labour is set to remain the largest party though the Conservatives are rumoured to make gains in the constituencies. In Scotland, the SNP will not win every seat after failing to displace the Liberal Democrats in Orkney. They are confident in Motherwell and Glasgow, but Edinburgh is anyone's game.  In England, Labour are on course to do worse than their first year under Ed Miliband and fall back on 2012 (it was 2012 when these seats were last contested). 

01:01: In terms of the battle for second place, there was also a 7.5 per cent swing from Labour to the Conservatives in Rutherglen. If that keeps up, the Tories will beat Labour to second-place - but only just. 

00:59: The SNP have taken Rutherglen with a nine point swing, putting them on course to take all of Labour's seats. 

00:56: Labour have been whomped by the SNP in Rutherglen, with James Kelly losing his seat by close to 4,000 votes (that's a lot in a Holyrood constituency). 

00:51: That is really a thumping win for the Liberal Democrats. Elsewhere, I am hearing bad news for Labour in Portsmouth, good news in Norwich, where they believe they may have taken three seats off the Greens, and that the Tories have made gains in Nuneaton, which is Labour-dominated at a local level but has sent a Conservative to Westminster since 2010. 

00:48: Rats! The Liberal Democrats have held Orkney, and I am down £20. They are up 32 per cent of the vote there. 

00:45: Turnout from Ogmore, where Labour are fighting both an Assembly seat and a by-election to, is above 40 per cent. Labour are confident of holding it. 

00:42: Labour have gained a seat from the Conservatives in Birmingham and are doing real damage to the Liberal Democrats in Newcastle. My comment about the Liberal Democrat revival is aging really, really well. 

00:40: Scotland incoming! Rutherglen result imminent! Scotpocalypse! Scotpocalypse! 

00:38: McDonnell is beasting Nicky Morgan on BBC doing a very good "more in sorrow than in anger" routine. 

00:34: For an alternative view on Zac Goldsmith, Andrew Boff, a Conservative member of the London Assembly, said this earlier today on Newsnight:

"I don't think it was dog whistle because you can't hear a dog whistle. Everyone could hear this"

00:31: Duncan Smith droning on about how Zac Goldsmith's campaign is not at all racist, oh no. I'm not getting paid enough for this. 

00:29: Iain Duncan Smith has appeared on screen. He says he is "hopeful" that Zac Goldsmith will be elected tonight. In Wales, the Conservatives have walked out of the count in marginal Delyn. Labour are sounding fairly pleased about that, as you'd expect.

00:27: I have made two discoveries. The firsts is that the lights in the New Statesman offices are motion-sensitive. The second is that sitting and typing is not quite enough motion. (It's just me here tonight.)

00:26: Council seats so far: Labour have 59, the Liberal Democrats have four, Ukip have none, the Greens have none. The SNP are hopeful of picking up all the Scottish Parliament seats in Motherwell and Glasgow, but Edinburgh is trickier territory. 

00:25: Speaking of bets...I look likely to owe Wings Over Scotland £20 (I bet on a clean sweep for the SNP in the constituencies), as Labour are buoyant about Edinburgh Southern and the Liberal Democrats are hopeful in Edinburgh Western.

00:19: John McDonnell doing a good job putting a brave face on some grim early numbers for Labour. This line about needing only do better than a general election is nonsense, psephologically speaking but he's making it sound like good sense. A validation of Jeremy Corbyn's decison to ignore even some of his closest allies and put him in as shadow chancellor. And still only 9 to 1 on Betfair as Labour's next leader. 

00:10: People on the BBC and keep talking about 2012 as a "high point for Labour". Is this true? Well, sort of. It was Ed Miliband's best year. However, that doesn't mean that Labour doesn't still have room to gain seats tonight - governments tend to lose seats in opposition and Labour lost seats pretty consistently in the areas up for election tonight throughout their 13-year-stay in government. So they still can and should make gains. And bear in mind, even Ed's good years were padded out with gains in safe Labour seats, which went from Labour strongholds with say, 40 Labour councillors and 20 Liberal Democrats to 58 Labour councilors and three Greens. In the places Labour needs to win at Westminster to get back into government, there is real room for growth. Which is why I wouldn't worry overmuch about losing some* seats in safe seats if when the marginals report Labour is making headway there. 

*Some is key. Going from a majority of 10,000 to 5,000 in Labour heartlands is fine if Corbyn is putting on 5,000 votes in seats Labour lost by that kind of margin. Going from a majority of 10,000 to -1,000 in Labour heartlands, less so. 

00:06: Labour look likely to lose Crawley

00:02: Labour have kept control of Newcastle Council, taking a seat from the Liberal Democrats. (I knew that would happen the second I typed the words "Liberal Democrat revival"). 

00:00: For those of you just joining us: welcome. Labour is projected to lose seats but remain the largest party in Wales, where the Conservatives seem to be gaining ground. In England, the Liberal Democrat revival appears to be a thing and not just a Twitter meme. In Scotland, the SNP are sounding buoyant while the Conservatives believe they may beat Labour into third. London won't count until tomorrow but everyone - Labour, Tory, Cannabis is Safer Than Alcohol - is getting jittery over low turnout. 

23:55: That early worry I heard from Wales has vanished completely from the Tory side. Vale of Glamorgan is rumoured to be close - a close to six point swing to the Conservatives. So we have biggish swings away from Labour so far tonight. 

23:52: Labour are down 17 per cent in the six seats we've had so far (from 2012 when last contested). Still not very much data, but that would put the party in the mid to low 20s in terms of nationwide share. Personally I think it's unlikely to be that bad when all the results have rolled in. 

23:48: How about that Liberal Democrat fightback, huh? The Liberal Democrats have won a seat in Sunderland from Labour. 

23:47: The knives are already out for Kezia Dugdale in Scotland, where Labour may come third. 

23:42: Bad news for Labour from Wales. Clywd South is in play and the Tories may well win it. Cardiff North, which is Conservative-held at Westminster, looks likely to go the same way in the Assembly having been Labour-held since 2011. Newport West and Llanelli are worth looking out for too. 

23:39: Good news for Labour - they've held the first seat to declare out of Newcastle, and the Liberal Democrats, their main opposition, have privately conceded that Labour will remain large and in charge in Newcastle. 

23:35: Speaking of the Liberal Democrats, they are feeling cautiously optimistic about winning a seat in Edinburgh Western from the SNP, while they expect to recover a bit from 2015. (Things could hardly get worse, I suppose.)

23:32: The first Labour gain of the night, as a Liberal Democrat councilor in Stockport defects. 

23:30: Labour sources are gloomy about their chances of holding onto Exeter Council, where Ben Bradshaw is the party's only remaining MP in the South West. Looks like it will slip into no overall control. Party is also nervous about holding Derby. 

23:25: Tory mole in Wales tells me that things look bad for them - potentially worse than the losses shown in YouGov's poll. The election has become "a referendum on steel", apparently. 

23:20: Early results from Sunderland show Labour doing fairly badly (you know, for Sunderland) and Ukip doing very well. But one swallow doesn't make a summer and we need more data before we know anything. 

23:15: We should get our first result from Scotland in 45 minutes or so. Rutherglen, Labour-held since the Scottish Parliament's creation in 1999, and highly likely to go to the SNP. 

23:13: And what the results mean so far, according to ace numbercruncher Matt Singh:

23:07: Those numbers from Sunderland, where Labour have held in St Anne's ward. Labour down 15 points on 2012, when these seats were last fought, Tories down 3. It's Ukip who are making the headway (they didn't stand last time and expect them do post performances like this throughout the United Kingdom tonight and as results roll in over the weekend). 

23:04: Back to Wales - YouGov's poll "looks about right" according to my Plaid Cymru source. What does that mean? Labour could go it alone and do deals on a vote-by-vote basis - they govern alone now with just 30 seats. If the poll is even a little out - let's say either Labour or the Liberal Democrats get one more seat - they might do a deal if they can get a majority with the Welsh Liberal Democrats. 

23:01: Pallion Ward in Sunderland is the first to declare, and it's a Labour hold! More on percentages as I get them. 

22:58: Why isn't it an exit poll, I hear you ask? Well, an exit poll measures swing - not vote share, but the change from one election to the next. People are asked how they've voted as they leave polling stations. This is then projected to form a national picture. Tonight's two polls are just regular polls taken on the day of the election. 

22:57: The Sun's poll - again, not an exit poll, I'm not kidding around here - of Scotland has the SNP winning by a landslide. (I know, I'm as shocked as all of you) But more importantly, it shows the Conservatives beating Labour into second place. The Tories believe they may hold onto Ettrick as well. 

22:55: What news from Scotland? Labour looks to have been wiped out in Glasgow. Liberal Democrats think they might hold at least one of Orkney or Shetland, while the seats in Edinburgh are anyone's game. 

22:52: Hearing that turnout is low in Waltham Forest, Lewisham, Hackney and my birthplace of Tower Hamlets (the borough's best export unless you count Dizzie Rascal, Tinchy Stryder or Harry Redknapp, that's me). Bad news for Labour unless turnout is similarly low in the Tory-friendly outer boroughs. 

22:47: YouGov have done a poll (note: not an exit poll, it should not be taken as seriously as an exit poll and if you call it an exit poll I swear to god I will find you and kill you) of the Welsh Assembly. Scores on the door:

Labour 27

Plaid Cymru 12 

Conservatives 11

Ukip 8

Liberal Democrat 2

There are 60 seats in the Assembly, so you need 30 seats for a majority of one. 

22:40: In case you're wondering, how would closing a seven point deficit to say, six, compare to previous Labour oppositions, I've done some number-crunching. In 1984, Neil Kinnock's Labour turned a Tory lead of 15 per cent at the general election to a Conservative lead of just one per cent. In 1988, one of 12 per cent went down to one per cent. (He did, of course, go on to lose in both the 1987 and 1992 elections). In 1993, John Smith's Labour party turned a deficit of eight points at the general to a Labour lead of eight points in the local elections. William Hague turned a Labour lead of 13 points to one of just six in 1998, while Iain Duncan Smith got a Tory lead of just one point - from a Labour lead of nine. In 2006, new Tory leader David Cameron turned a 3 point Labour lead to a 13 point Tory one. Ed Miliband - remember him? - got from a Tory lead of seven points to a two point Labour one. 

22:35: John McDonnell is setting out what would be a good night as far as the party leadership is concerned - any improvement on the 2015 defeat, when the party trailed by close to seven points. Corbyn's critics say he needs to make around 400 gains.

I've written about what would be good at length before, but here's an extract:

"Instead of worrying overmuch about numbers, worry about places. Although winning seats and taking control of councils is not a guarantee of winning control of the parliamentary seat – look at Harlow, Nuneaton, and Ipswich, all of which have Labour representation at a local level but send a Conservative MP to Westminster – good performances, both in terms of increasing votes and seats, are a positive sign. So look at how Labour does in its own marginals and in places that are Conservative at a Westminster level, rather than worrying about an exact figure either way."

22:31: Oh god, the BBC's election night music is starting. Getting trauma flashbacks to the general election. 

22:22: A few of you have been in touch about our exit poll. Most of you have been wondering about that one vote for George Galloway but the rest are wondering what happens - under the rules of the London mayoral race (and indeed the contests in Salford, Bristol and Liverpool), 2 votes would not be enough for Sadiq. (He needs 2.5). However, all the other candidates are tied - which makes it through to the second round. What happens then is the second preferences are used as a tie-break. Of the tied candidates, Sian Berry has the most second preferences so she goes through to face Sadiq Khan in the final round. Final round is as follows:

Sadiq Khan: 3

Sian Berry: 2

3 votes is above the quota so he is duly elected. An early omen? 

22:19: Burnham latest. A spokesperson for Andy Burnham says:

"Approaches have been made to Andy Burnham to give consideration to this role. It is early days and no decision as been taken. Whatever the decision, he will continue to serve the leader of the party and stay in the shadow cabinet."

22:17: Anyway, exit poll of the office. We've got:

Sadiq Khan: 2

George Galloway: 1

Caroline Pidgeon: 1

Sian Berry: 1

22:15: Update on Andy Burnham. He has been asked to consider running. More as we get it. 

22:13: People are asking if there's an exit poll tonight. Afraid not (you can't really do an exit poll in elections without national swing). But there is a YouGov poll from Wales and I am conducting an exit poll of the four remaining members of staff in the NS building. 

22:11: It's true! Andy Burnham is considering running for Greater Manchester mayor. Right, that's it, I'm quitting the liveblog. Nothing I say tonight can top that. 

22:09: Rumours that professional Scouser Andy Burnham is considering a bid for Greater Manchester mayor according to Sky News. Not sure if this is a) a typo for Merseyside or b) a rumour or c) honestly I don't know. More as I find out. 

22:06: Conservatives are feeling good about Trafford, one of the few councils they run in the North West.

22:03: Polls have closed. Turnout looks to be low in London. What that means is anyone's guess to be honest. There isn't really a particular benefit to Labour if turnout is high although that is a well-worn myth. In the capital in particular, turnout isn't quite as simple a zero-sum game as all that. Labour are buoyant, but so are the Tories. In Scotland, well, the only questions are whether or not the SNP will win every single first past the post seat or just the overwhelming majority. Both Labour and Tory sources are downplaying their chances of prevailing in the battle for second place at Holyrood, so make of that what you will. And in Wales, Labour look certain to lose seats but remain in power in some kind of coalition deal. 

22:00: Good evening. I'm your host, Stephen Bush, and I'll be with you throughout the night as results come in from throughout the country. The TV screens are on, I've just eaten, and now it's time to get cracking. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.