Like many people, I had spent much of the last year or so wondering about the supine reaction of Liverpool supporters to the Gillett & Hicks take-over. Here were two people coming in with no apparent prior interest in Liverpool Football Club, making numerous promises and claims, but with the prevailing common knowledge becoming apparent that they didn't have the cash up front to pay for it. Very few people that closely connected wondered aloud where the money was going to come from. The club was being purchased for £300m and the new stadium will cost something like £400m. These are substantial amounts of money. They were also making promises of spending obscene amounts of money on players. In spite of this, Stars & Stripes flags were flown on match days. The arrivistes were feted as saviours. It was almost as if no-one had been paying any attention to what had gone on forty miles up the road at Old Trafford for the last few years or so. Considering that Liverpool is the city that was the birthplace of Militant, the home of the Dockers' strike and a city which remains one of the most politically left-wing in Britain, it was all most perplexing.

Over the last few weeks or so, the wheels have come spectacularly off the wagon for the new owners. They may have secured the refinancing package that they desperately needed, but it hasn't come cheap and it is now common knowledge that, just as at Manchester United, a football club is effectively paying for itself to be taken over by outside investors, and at a cost of £30m per year in interest payments alone - money which, ultimately, will come from the supporters themselves. The seeds of the problems for Gillett & Hicks were sown in their treatment of Rafael Benitez. Whatever the shortcomings of Benitez are, he has taken them to two European Cup finals in three years and is still enormously popular on Merseyside. The club's apparent misjudgement of this incurred the wrath of the supporters and a demonstration march to the ground towards the end of last year. The lack of harmony within the club may or may not be directly responsible for the club's slump in form, a slump so severe that it hasn't merely ended their Premier League championship bid but will quite possibly result in them taking part in the UEFA Cup next season rather than the Champions League. There was a further demonstration against Gillett & Hicks at the recent match against Aston Villa. Something, one suspected, was in the air. At last.

The upshot of it all is "Share Liverpool FC", launched today in the city by Rogan Taylor, a long time Liverpool supporter and the chair of the Football Supporters Association, Kevin Jaquiss, a lawyer specialising in employment law who was part of the group responsible for writing the legal model upon which all supporters trusts are based, and Phil French, a former director of communications of the Premier League who is now employed as the chief executive of Supporters Direct. In terms of knowledge and support, you couldn't really ask for much more experience. The plan is a simple (if ambitious) one: persuade 100,000 Liverpool supporters to pay £5,000 each and raise £500m to buy the club, and then run it as a not-for-profit mutual society, with no shareholder dividends and no profit. The group has had a somewhat shaky start (such was the level of interest that the web site collapsed fifteen minutes after it went live and, at the time of writing, hasn't recovered yet), but this would appear to bode well for them - a considerable amount interest in a concept that very few people had even heard about as recently as a couple of days ago.

So, can it work? Well, it can. These are monstrous amounts of money, though - are there 100,000 Liverpool supporters in the world who will part with £5,000 in order to take control of the club? Are there that many supporters groups that will band together and buy shares between them? The next few weeks will provide a few answers to this, but it is worth remembering that if nothing else, we should applaud the principle of this idea. Some, such as the apparently "humorous" website Who Ate All The Pies, have already chosen to scoff at the announcement, with a magnificently ill-informed article on the announcement that appears to have been written on the back of a cigarette packet in the pub. I don't know which part of their piece on the subject (which I'm not linking to from here - if you want to see it, you can go and look for yourselves) is the worst: "They should leave the running of the club to the money men in suits who know about such things", or "this is communism at its most hare-brained" are vying with each other (and a whole host more) for the most the most ill-informed comment on the subject. Having embarked upon second and third readings of it, I can confidently state that more or less every single sentence of it is as bad as the one that preceded it.

This season's major trend has been a very singular type of managerial sacking, involving "intolerable pressure" building up in the media, directors and owners panicking, and a manager's job becoming basically untenable, regardless of whether he deserves to be sacked or not. In some cases, it was undignified to the point of being embarrassing to watch, such as at Chelsea, where the boardroom politics, the despotic ownership and the ridiculous amount of control given to senior players were made public. At Newcastle, Sam Allardyce did the impossible, in becoming a figure of public sympathy for being ousted through a mixture of supporter ignorance and an owner that seems to be too eager to please said ignorant supporters.

Now, at Liverpool, the position of Rafael Benitez seems to have been undermined still further by the actions of their owners, George Gillett and Tom Hicks. It has become apparent as the season has worn on that Liverpool are not going to mount a serious championship challenge in the Premier League. In fact, if anything they seem to have taken a backward step since last season, and are currently playing like they have more in common with the likes of Everton, Manchester City and Portsmouth than they have with Chelsea, Manchester United and Arsenal. The money that was reported to be delivered to Benitez to further strengthen his squad doesn't appear to have been forthcoming, and now there are worrying rumours coming from Anfield regarding a need to restructure the club's finances ahead of the construction of a proposed new stadium in Stanley Park. There are some Liverpool supporters that are starting to sound increasingly alarmed, to the point of drawing similarities with the beginning of the decline of Leeds United.

The problem at the centre of Liverpool's current difficulties is the funding of their take-over last year. As with Manchester United, Liverpool were subject to a leveraged buyout, meaning that Gillett and Hicks utilised stock market rules to purchase the club for a fraction of its actual value. At the time, Liverpool's supporters were very supine about it all. Stars and stripes flags were waved at Anfield. The new owners were more than happy to lap up the praise when they got to the European Cup final in May, even though they'd had precious little to do with it. This season, their big summer signing Fernando Torres has carried them single-handedly through the season. They made a dog's dinner of getting through their group stage, losing to Besiktas and Marseille in a group that they should have had sewn up with games to spare. In the Premier League, they have slowly and consistently fallen further and further away from the top three since the start of the season.

The major problem for Liverpool FC is that they simply cannot afford to not qualify for the Champions League this season and, indeed, every season for the forseeable future. The buyout of the club cost £300m, which has been loaded against the club itself. On top of this, one of Gillett and Hicks' first acts when they took over was to promise to build a new stadium, at a cost of a further £300m. Liverpool were already said to be £80m in debt at the time of the buyout. Gillett and Hicks are said to be trying to restructure the club's finances through the banks, but this in itself is an expensive business. A recent report in the Daily Telegraph put the cost of the restructuring at £15m, and the cost of the new stadium has already risen to £400m, with £20m having already been paid to architects.

In the beginning, Liverpool's supporters were open to the idea. Broadly, they supported Gillett and Hicks against their rivals in bidding, Dubai International Capital, who represent the interests of the ultra-wealthy Maktoum family. Gillett and Hicks said the right thing. However, leverage buyouts are done for one reason. To buy something that is considered under-valued in the market without putting much investment in and sell it on at a profit. DIC may well have the funding to underwrite the club's debts, but they have already stated publicly that they don't much want to pour money into a black hole (and why, indeed, should they?). The danger, for Liverpool, is that they could end up hundreds of millions pounds in debt, unable to service so much as the interest payments on debts that they may already have unnecessarily run up.

At Manchester United, supporters were already protesting before the Glazer takeover. It might not have been enough to prevent the buyout there from going through (although anyone looking at the end of year figures coming from Old Trafford will be able to tell you that journalists stating massive profits there simply hasn't read the full story of how they've been massaged), but their disaffected supporters at least have an alternative. Liverpool supporters might just find that things could get a lot worse for them before they get any better.

Here's a video from December 1983 of Liverpool (about who's current woes I have quite a lot to say) coming up against what I can only presume was an unexpectedly feisty Coventry City side in the First Division. Commentary comes from a pre-histrionics John Motson.