Some quick thoughts I have had while chatting over on the main threads at DKos, which I think I will try to summarize quickly, keeping in line with my coverage of the run-up to this election.
First off, Labour. I think it is a rebuke of Blair rather than Labour. Certainly not Gordon Brown, who actually gained votes (although, in part, this was a result of boundary changes in Scotland). But more than a rebuke of Blair the man, I think this was definetly a blow to the New Labour "project" as a significant, coherent intellectual and ideological movement. Brits are brutally pragmatic people, and are very much sick of Blair's grandstanding, moralism, spinning, and personal megalomania, which are all a part of his and his acolytes' True Believer sense of themselves - all of which culminates in the public's general rejection of the Iraq War, although this sense of revulsion is about more than just the Iraq War. I sense that Blair has realized he has been rebuked too - his body language was very telling, as was watching him listen to Reg Keys (a man whose son died in Iraq and who garnered 10% of the vote against Blair in his Sedgefield constituency) give his concession speech. To give an analogy, Blair is like the chastened college student who realized he partied too much all semester after receiving a report card that brought him Cs rather than his usual As. BUT: strangely, at the same time, this result is also finally confirmation or (at least tacit acknowledgement) that Labour is now the natural party of government. People are just comfortable with them and the material things they provide - even if they are disgusted by the hubris and arrogance of the New Labour<sup>TM</sup> project - because a weaker party would have lost this election.
Now to the Tories. Although they made decent gains in terms of seats and their folks were acting pleased on TV, I think they will ultimately be disappointed with this result. They are the minority party, who are stuck at about 33%, and basically only advanced because Labour voters defected to the Lib Dems, minor parties, or sat at home. In other words, they gained by standing still. There can be no doubt that they are no longer the "natural party of government," as they were during the 20th century. They have to attract more younger voters, because right now they are far too old and unfashionable a party (and strangely benefitted from this in this election because their core voter, because old voters are loyal voters, turned out, when a lot of Labour support sat on their hands). They still have not figured out to compete on electoral landscape with a Labour Party that is no longer socialist. Some bright spots that might augur well for the future, though: a black Tory (first ever) was actually elected (in Windsor - ultra safe constituency where the Queen's castle is). And some young woman (name is skipping my mind) was elected in Putney (one of the better Tory wins of the night) who looks to my eyes - saw her being interviewed after her victory - to have a real future.
On the surface, it looks as though the Lib Dems did quite well. And indeed, they won over 4% more of the vote than they did in 2001 and benefitted greatly in some parts of the country from a general disgust (mentioned above) with elements of Labour. On further reflection, though, I think the Lib Dems gains could be ephemeral. They are trapped between on the one hand their rural constituencies where the main challenger is the Tories and many urban middle class liberal areas, where the main challengers are Labour - which is a strange, unwieldy coalition that does not augur well as a basis for a future breakthroughs. In other words, they can't be a center-left social democratic party and a center-right libertarian party simultaneously. Then again, maybe they can. But it would take some pretty ingenious leadership to pull this feat off. And while I think Charlie Kennedy is a better leader than many in the media think, he's not that good. Ultimately, if Labour dumps Blair and gets down to earth and back to basics with the public, I think some of the LibDems election gains this cycle could be washed away.
Ultimately, what this election was was a rejection of "Blairism" as an ideological project. People want essentially what New Labour provides in material terms, but without all the grandstanding, moralism, and Blair's megalomania - all the thinks of which the Iraq War came in some ways to perfectly exemplify. Strangely, as the above might suggest, it is hard to see any real winners from this election. If I had to pick one, it would be Gordon Brown and the not-Blair forces in the Labour Party.
"[Update]" To sum up, people like New Labour *policies* - what they don't like is the New Labour *project*. See the following I cribbed from a British site I frequent:
First of all congratulations to the opinion pollsters who got it right and to those here who did.
My thoughts are that Blunkett said that normal politics has been resumed. In a sense this is a victory for Labour and a defeat for the project". Labours challenge now will be to keep the awkward squad on board without upsetting middle England (places like Broxtowe, Bedford).
The project was an attempt to turn Labour into a centre right party and depended on the left wing core vote having nowhere else to go. The project has failed because the core left do now have somewhere else to go - the Liberal Democrats.
A few more votes in the right places and I think that Labour would have had a majority no better than Majors in 1992. However, upon reflection I think it is probably a good thing for the tories that Labour have the majority they do.
Labour will still struggle at times - there are apparently at least 40 Labour MPs who want nothing to do with New Labour and all its works, but if Labour only had a 25 majority I suspect that Blair would have rapidly been replaced by Brown who would have called an election in Autumn 2005 and increased his majority up to about 90-100. This would have devastated the tories for a generation.
As it is Gordon will probably be able to handle the awkward squad far better than blair and with a majority of 60ish the electorate would take a dim view of any attempt to call an early election.
What will affect 2009/10. Three things. Tories have about 40 young fresh entrants who I am sure we will see a lot of. Gordon Brown while undoubtably talentated does not posess Blairs silver tounge and the main one The Economy Stupid.
If the economy falters, Labour will face a devastating Pincer attack from the Libdems and Tories and could face a worse result than 1983, despite the tories gaining a small majority or no overall majority. If that happens I dont see the liberals going into coalition with Labour and going down with the sinking ship - they will be aiming to replace Labour and restore their historic position in British politics.