UEFA Champions League: Keith Duggan on the struggles of a proud old aristocrat now short on silverware to compete with the new money as represented by Abramovich's Chelsea

The Albert pub on Walton Breck Road must have great foundations, because on the great nights in Anfield the walls all but trembled with the roar from the Kop. It is right next door to the famous terrace side of the ground, just yards away from the fine bronze sculpture of Bill Shankly, arms aloft and scarf fluttering. For three decades the Thompson brothers, who were raised on nearby Scotland Street, have been meeting up every second Wednesday for afternoon pints of mild. There were 10 brothers. Now, David and Joseph are the only ones left and on a bright, sleepy afternoon they are enjoying drinks with their brother-in-law, Daniel Temperley. The privilege of retired working men.

David is telling this story that dates back to their days on the docks of the Mersey in the late 1960s, just before containerisation when tens of thousands of men were employed on the waterfront. Among them was an ageing labourer, Forkie Kelly, one of those characters long since departed the world who just glimmer in the memory of his acquaintances. One afternoon, the dock they were working on was visited by an inspector by the name of Moon and the workers were expected to line up in military fashion as he walked around. Out of nowhere Forkie burst forth, a grimy, hunched figure, and leapt on to the back of the astonished inspector. It was just weeks before the much-anticipated Apollo 11 mission.

"Look at me, lads," he shouted. "The first fucking man on the Moon!"

It is one of those stories where the punchline acquires a better vintage each time it is told and David gets a great, spontaneous response from the afternoon drinkers.

The three are lifelong fans of Liverpool Football Club, old enough to have vivid recall of Billy Liddell's storming performances through the 1950s while caring deeply whether Stevie G will be torn from his boyhood club and into the Roman Abramovich vacuum. Like most Liverpudlians, the present state of the club leaves them at something of a loss, and it is by way of apology that Temperley says, "It's been a bit sad at the moment. It's a bit low."

It is a quiet week around Anfield, with no weekend match, and so a few day-trippers wander around the ground taking photographs next to the statue. The redbrick streets of Anfield are devastated in places - all the houses one side of Lotham Road, close to the gold-tipped Shankly gates reading You Will Never Walk Alone, are derelict and secured with metal shuttering where, presumably, once were painted doors and lit-up windows.

"This whole area used to be blooming," Joseph Thompson says. "Full of life, of shops, of families. Our youngest brother, Denis, he had a barber's across the road for years and years. He'd cut all the players' hair. That's a photo of him there," and he points to a snap of his brother on the wall amongst framed caricatures of Heighway and Hansen and Hunt and St John.

"It only really started to go down about 10 or 20 years ago with the drugs and all, but they say they're goin' to turn it around again, get some regeneration going. I don't know."

Among Liverpool people, there is an overwhelming and touching sense of pride in a city that, although economically impoverished for decades, has retained an odd, understated beauty, with red-tinted, architecturally-striking buildings at every turn as proof of what the city once was. In its heyday, Liverpool was the second greatest port in the world, the base for 40 per cent of global shipping.

In the second World War, it was the nerve centre for the battle on the seas. Like most of the English cities, it was battered and bombed hard, and the shell of a church, now known as the Bombed-Out Church, has been preserved in its ruination as a tribute to that time. Beside those ruined walls is a plaque that details precisely why Liverpool is different to all other English cities. Between 1849 and 1852, 1,241,410 Irish emigrants landed on the docks of the city, a statistic that hides an epic and scarcely understandable tale.

This was at a period when 40,000 locals were already living in unimaginable poverty in cells by the river. Nonetheless, the generosity demonstrated by native Liverpudlians to the wretched and dying was heroic and voluntary and utterly changed the nature of the city. The density of that period has come to fascinate Rogan Taylor, an academic and Kopite whose adolescence happened to coincide with the rise of the Beatles and Shankly's first tilt at greatness.

"The place was rocking. You know, 1962 comes the Beatles' first single, two years later we win the league. Ian St John has come to play with us. I was naïve enough at 15 to think that Liverpool had always been like this. Then you get older and notice the buildings, these great symbols of wealth all around you, and start to read back about the affect the Famine had here. If I had a time machine, Liverpool city around the mid-19th century would be my first stop.

"It was just a crazy place. Like, to stand outside the Temple of Rational Mirth on the pier head where disciples of HR Davie had laughing gas in pigs' bladders and local lads would come in and get stoned out of it for a penny a throw.

"Or you walked into a pub where there were dog fights or rat fights being held. There was this account of a youngish lad who walks into a Liverpool pub and says, 'give us a pint of wallop, John, and two rats'. He wanted these rats to train the dog on and he asks the guy to take out the rat's teeth. 'Whiz the stingers out, John,' he says. And the guy who wrote this piece describes these teeth hitting the stone floor.

"That kind of toughness and that kind of incredibly vibrant folk culture - an oral, Celtic, performing culture, is what this city is about. And on a completely different level, if you read the stuff after Hillsborough, all the editorials in the Mail and other organs just repeat the same lines the Times used back in the 1850s. 'Oh, these people they wail in public and sit around telling stories and having a good time. No wonder they are starving.'

"After Hillsborough, it was 'why don't they go home and grieve privately in the quiet of their bedrooms? This is what the English are supposed to do!' But, see, that's the problem. In Liverpool, we're not English."

At least not in the Establishment sense. It is with some satisfaction that David Thompson in the Albert pub reminds his audience that the only Liverpool football player to ever receive a knighthood was Matt Busby.

"I think they have something against us up here. It's cos we stick up for ourselves. We fight our corner," he grins.

That is the traditional Liverpool attitude. It was something Shankly tapped into when he set about reviving the ailing club in the mid-1950s. As Rogan Taylor explains, "The greatness of a manager like Shankly was not just in winning things. Paisley was a better manager in that sense. What Shankly did was build an ethos which reflected the best qualities of the community. And the magic is that the crowd is looking into a mirror of its own best selves.

"When someone asked Shankly after Liverpool went up to the first division in 1962 what kind of football the team would play, Bill said, 'We play socialist football here. There are no prima donnas. We play for the full 90 minutes. We serve one another.'

"That is very clever, because it is what our best selves is about."

David Thompson worked for the council as a bin man for a time and his route took him to Shankly's house on Belleville Road. Every so often, the Liverpool manager would come out and hand a few match tickets around to the rubbish collectors and talk football with them. Stories of that kind abound about Shankly, and, although the Scot died in 1981, he remains an omnipotent force around the city.

When the Albert crew talk about his sudden and unhappy decision to leave the club in 1974, it is as if they are referring to a recent happening.The true reasons are still debated, and while there were rumours that his wife was suffering from ill health at the time, David said, "No, no way. Nessie was fine. She lived a good long time after that. It wasn't Nessie."

By his departure, however, Shankly had cast in iron the notion of 'the Liverpool Way'. On the public tours of Anfield that are conducted during the quiet midweek days, his is the name mentioned most often and his old idiosyncrasies still prevail.

In the home dressing-room - everything a nostalgic could hope for, with plain wooden benches, hangers - the team shirts are still hung on the wall according to team formation so the defence dresses at one wall, the midfield at another and so on.

Like all the authentic and atmospheric sports venues, Anfield is a shrine, and so it is no surprise to find greying men touching the iconic sign that leads down the steps to the playing field with childlike fervour. At the Kop end, they take photographs and try to imagine the tumult and madness of the old terrace in the days when 30,000 people would meld together.

Les Lawson, secretary of the Merseyside branch of the Liverpool supporters' club, grew up in the happy insanity of the 1970s. His favourite Anfield night was the 1977 quarter-final against St Etienne, "when we all had to bunk off school at three o'clock but it didn't matter 'cos the teachers were all heading to the game anyway. Back then, you got to the ground three hours before the game and you waited. You waited and sang."

The Kop invented terrace song, according to Taylor. It started in 1962 with the Gerry and the Pacemakers hit, and then other songs were adopted and then they were simply made up. So it went from the lusty singing of pop choruses to the day, when 4-0 up against Grimsby Town, the Kop decided to cheer up their visitors with a few bars of "Sing When You're Fishing." The Grimsby gang warmed to this so the Kop went on to invent fish names for the Liverpool team through the second half. Kenny Dalgfish. Phil Eel. Stingray Kennedy. Jimmy Plaice. They went through the entire 11.

Taylor's favourite Kop evening was at Tommy Smith's testimonial two nights after the European Cup win of 1981. The game was just a lark and, remembers Taylor, "The Kop was in a weird mood and it started directing other parts of the ground to do things. So it sang to the Anfield side, 'Annie Road, Annie Road sit down'.

"And bugger me, but they all sat. Then it sang for the main stand to rise and all the elder Jewish season ticket people rose. Then it called on the directors box to stand and you could see what was going on here, that it was a statement of power and letting everyone know where the heart of this club was located. And you could see all the old camel coats thinking, 'f***k it, boys, we better stand up here'. And then, see, the Kop took it that bit further and it did this genius thing where it sang for itself to sit down. And then the Kop sat. It was the most powerful piece of street theatre I ever saw in my life."

It is that culture as well as the once unending seasons of silverware and records that has cemented the belief among Liverpudlians (or those who do not love Everton) that the Anfield club is simply deeper and more important than other soccer club. Anywhere. And it is that history and legacy that swims around Rafael Benitez as he becomes the latest manager to try to shake the club from its torpor.

During a period when English soccer is moving at the speed of light, Liverpool is conflicted and its people caught between a warm and sentimental loyalty to the past and a deep fear that whatever change must come will not be enough. Alan Kennedy, once a god of the Kop, presents a nightly radio show in the northeast. He describes himself as a Liverpool supporter now. Like the Albert pub gang or Rogan Taylor or Les Lawson, he is anxious that the board of Liverpool accept it is time to bow down to outside investment and to re-energise the plan to move to Stanley Park, the green common that splits Anfield and Goodison. The Liverpool way - steady and unshowy and fundamentally sound - has been eclipsed by fast money.

The struggle for Steven Gerrard has come to symbolise something central about the present state of Liverpool Football Club's prestige and ambition. To lose the kid who still hangs out with David Thompson's nephews in the estate of their boyhood would be to lose the last remaining local jewel. There will be no animosity to Gerrard if he leaves, but it would be a deep blow to the morale.

"I would love Stevie to stay," Kennedy says. "And I met Rafa with John Aldridge and he was a really impressive man who wants to return the club to where it once was. But see, if Roman Abramovich comes along and if he offers £40 million or whatever for Stevie, there is also the thing that we need the money. No one player is a team. We are trying to build a new stadium. If Stevie feels he has to go, it might be impossible to say no."

Stay or go, there is no guarantee that Liverpool will recover that incandescence that set it apart until Heysel and then Hillsborough made football a more sombre obsession. Taylor believes that the modern equation for football is Hillsborough and Heysel over satellite television equals the current product. Liverpool, central to both those football tragedies, has somehow got lost in that equation. In any city centre bar, the reasons for the decline of the football team are tossed about. The wilful dismantling of a championship team by Graeme Souness in the early 1990s had calamitous consequences for the rest of the decade. Gerard Houllier erred in his signings after collecting £12.5 million for Robbie Fowler.

Small, significant mistakes that flew in the face of the prudent, seamless way in which Shankly and then Paisley and Joe Fagan conducted business.

The theories are endless. In Liverpool, the talk is endless. "Turn over any stone in this city and you'll find some guy underneath babbling away," says Taylor.

The funny thing is, the local economy has begun to improve as dramatically as the Anfield club have lapsed behind their old foes. In 2008 Liverpool becomes the European City of Culture; 15,000 old redbrick houses are scheduled for demolition before then with new developments already drafted. The city centre, sloping haphazardly down to the Mersey, is teeming with life. It may qualify as the friendliest city in the world. Things are getting better, but on the radio, Benitez, talking of the famous old club, sighed this week and said "things are not as they should be".

And perhaps they never will be. Kennedy, like any other local fan, fervently believes it is just a matter of time before Liverpool are reborn. It is time to let go of tradition. Anfield will be razed and replaced with a hotel and other interests.

But as you walk around the empty ground, as peaceful in its emptiness as the city's Metropolitan cathedral, you have to wonder if abandoning their home, burying the ghosts of the Shankly era will just place Liverpool Football Club at a further remove.

You have to question whether it would still be Liverpool Football Club in the sense that its people believe it to be. "Things grow and evolve," smiles Taylor. "We will see. Death is followed by resurrection in the mythical world. For my generation and the older people, it may never be as good. Football can never be the same."

And so on they walk.