If there is no fight, it means extinction for indispensable services and jobs. The Tories' planned cuts exceed three-quarters of councils' core funding.
But Jeremy Corbyn's anti-austerity June manifesto inspired 3.5 million more votes for Labour. Many of those new voters are now pondering how to pursue that cause in the local elections.
This double dawning - of council bankruptcy and debate on resistance - makes the case for an anti-austerity electoral challenge. Speaking for the Socialist Party, Hannah Sell told the TUSC conference: "If we agree to contest these elections, they will be the most important TUSC has ever contested."
Hannah argued that while TUSC should stand with care, only where our candidature helps the battle against the pro-austerity, pro-capitalist wing of Labour, it is essential we stand.
The problems are acute, as TUSC national chair Dave Nellist pointed out. England's secondary schools have cut 15,000 teachers in a year, the School Cuts union campaign has found. 11,000 firefighters' jobs have gone since 2010 reports the Fire Brigades Union.
In the same time, over half a million council workers have lost their jobs, according to public service union Unison. Corbyn is right to call council austerity "no less than the dismantling of the civilised society."
This government's lifespan is unpredictable. It could collapse at any point or, theoretically at least, last till 2022 - although, Hannah says, "that seems very unlikely."
But if it does, the Local Government Association calculates councils will lose 77% of their 'revenue support grant' by 2020. This takes central funding back to "pre-Poplar levels" - back to 1920.
And what do the Tories propose to replace it? Outsourcing to corner-cutters, as preparation for service charges - the "easyjet council."
But outsourcing doesn't work. Tory-run Northamptonshire County Council exemplifies the model. In 2015 it privatised its workforce en bloc. In-house numbers went from 4,000 to just 150.
This month Northamptonshire issued a 'section 114' notice, banning all non-statutory spending. The "easyjet council" is bust.
Meanwhile Labour is still two parties in one. And the pro-capitalist, pro-austerity, Blairite party is stuck on the same course.
Hannah pointed out that of the top ten councils to have overspent, only two are Labour-run. The Blairites have proven themselves enthusiastic axe-wielders.
Sean Hoyle, speaking for transport union RMT, calls for political representatives who oppose 'driver-only operation' (DOO - removing the safety-critical role of train guards). He asked Labour's Liverpool region mayoral candidate, Steve Rotheram, for his stance.
Sean ended up "chasing Steve Rotheram around the room" in a vain attempt to get an answer. Meanwhile, TUSC candidate Roger Bannister stood on clear opposition to DOO.
The Socialist Party's motion to the conference argued that "to allow the Blairites to go unchallenged generally is to allow them to build their authority." They will use this against Corbyn's leadership if he forms an anti-austerity government.
It would be best if the working class thrust Corbyn into power on the back of a mass struggle. A mobilised workers' movement could defend against Blairite sabotage and push him to be bold.
All workers would benefit from coordinated action with the approach of militant unions like the RMT. Sean's message to fellow union leaders was "let's get off our arses and lead a fight!"
But even without this, the fractured, minority Tory government could collapse - under the weight of Brexit negotiations, scandal, or renewed economic crisis. Corbyn could face a clash with big business, and consequent fight with the Blairites in government, within months.
Should TUSC let the right prepare without continuing to build the genuine anti-austerity forces needed to confront it?
In the meantime, Hannah said, big sections of the working class are "still thinking all politicians are the same." So "the tendency on the left of the Labour Party to disguise that there's a fight going on" will undermine Corbyn's chances of winning a general election.
"It's important we get a Jeremy Corbyn-led government," said Roger Charles, speaking for TUSC's individual members. "But we can't do that if we've got Jeremy at the top... and councils undermining what he's trying to do."
Many teaching assistants in Durham, striking against malicious pay cuts by a right-wing Labour council, felt their only recourse was voting Tory, Lib Dem, Green or not at all. Should TUSC allow cuts-making parties the space to grow unchallenged?
Southampton councillor Keith Morrell will be standing for re-election as a principled anti-cuts representative. This is in spite of an unfortunate Momentum-backed Labour challenge to him, a socialist incumbent.
Cancer survivor Nicola Jackson is part of the campaign to save beds and emergency care at Huddersfield Royal Infirmary. "I'm fairly new to socialism," she said, "but I'm intending to stand in the local elections."
"I support 100% Jeremy and John," said Sean. TUSC has been careful to stand candidates against Labour only where it strengthens the battle against the Blairites and austerity policies.
But a mere one in eight of the Labour councillors TUSC has so far surveyed could be described as Corbynistas. Even this is "with the most generous definition possible," said Hannah.
Haringey is an exception. The community campaign against mass privatisation has deselected most Labour councillors who backed the hated 'Haringey Development Vehicle' (HDV). "These land wars are springing up all across London," said Nancy Taaffe.
And Haringey Labour's subsequent manifesto conference, dominated by the left, discussed many of TUSC's anti-austerity policies. However, as yet there is no commitment to a no-cuts budget.
Labour members around the country are discussing different models of resistance. Momentum leaders point to Bristol mayor Marvin Rees, who mobilised a big anti-cuts march - but continues with cuts.
Others look to Preston, which has attracted a modicum of business investors - on top of cuts. Nor do council tax rises offer a means to avoid cuts.
However, now the discussion is not about whether to resist - but how. This is very positive. "There is a fray," said Paula Mitchell, "which we must enter." Standing gets TUSC that entry to these debates.
Setting no-cuts budgets, using reserves and borrowing powers, will not defeat austerity alone. But what if "there was even one council prepared to 'do a Liverpool'," asked Hannah. Linking a no-cuts budget to building a campaign to win the needed funds "would transform the situation."
There are fewer legal barriers to this approach than when Liverpool fought in the 1980s. We argue for a legal no-cuts fightback. But if it becomes necessary, unjust laws should still be broken.
Weak Theresa May is "not the Iron Lady." And anti-cuts Corbyn heads Labour, not proto-Blairite Neil Kinnock.
However, while many new Labour voters are looking for an electoral challenge to Blairism, many others will see a Labour vote as the best way to support Corbyn. Standing is an opportunity to engage with them too, and discuss how to win the fight in Labour.
The Socialist Party's motion to stand selected candidates against the enemies of Corbyn's anti-austerity agenda received unanimous endorsement from the conference.
As Sean said: "if we do nothing, the bigger danger is we damage Jeremy." We must act, said Dave, or "the glue that holds society together" will be gone.
With press coverage of Brexit and of the Tories' shambolic attempts to find agreement with the EU at fever pitch, the afternoon session of TUSC's 2018 conference was dedicated to the approach of socialists to the negotiations.
Speakers reminded the conference of TUSC's "history of principled intervention into the EU debate," as chair Dave Nellist described it.
TUSC followed on from the 'No2EU' electoral alliance between the Socialist Party, transport union RMT and others. No2EU offered a working class, left, anti-EU choice in the 2009 European Parliament elections.
And during the EU referendum, TUSC fought to stop recognition - and the funding that went with it - being given to Ukip and the Tories as the official Leave campaign by the Electoral Commission.
Speakers in the session to discuss TUSC's post-Brexit position included Claire Laker-Mansfield, Socialist Party executive committee member, and RMT president Sean Hoyle.
Claire pointed out: "We're not interested in taking the side of one wing of big business, or one side of the ruling class, or the more 'progressive' elements of capitalism. We're interested in fighting to overthrow capitalism and putting forward an independent, working class approach to the question of Brexit."
We should not forget that the EU referendum result was a working class revolt which saw the immediate end of David Cameron as prime minister and has left the Tories weak and in crisis ever since.
Sean Hoyle posed the question of whether a 'Tory Brexit' was more likely than a socialist one. The RMT's opposition to the EU stems from the EU's drive for privatisation and barriers to state aid and public ownership. Also, its driving down of pay, terms and conditions, which Sean railed against.
He said: "We must fight to organise, defend and fight for migrant workers to be on the same terms and conditions and wages." Sean told the conference about maritime workers from Ukraine earning as little £2.45 an hour in the UK - perfectly legal under EU rules.
A socialist exit would mean breaking with the Single Market, which is nothing more than a series of treaties by capitalist governments that mean a race to the bottom and an obstacle to socialist policies. Claire reminded us that it was Margaret Thatcher who signed Britain up to the Single Market. Jeremy Corbyn at the time correctly campaigned against it.
Socialists start from the position of opposing rules that allow this exploitation and pro-capitalist treaties. We oppose any Brexit that would allow this to continue.
Claire said: "Jeremy Corbyn is strengthened since the general election. Now is the time for a socialist exit - against austerity and for nationalisation."
These points were supported by others during the discussion. Mark Best said: "Corbyn should stand on the movement of working class people and youth who pushed him into leadership" to stand up the Tories and those in his own party who want to stand in the way of a socialist Brexit.
Paul Callanan talked about the 20-city TUSC tour that put forward these arguments during the referendum. The referendum didn't take place against the backdrop we would have liked but then and now we need to fight to use the opportunity that exists to carve out a different approach to the Brexit negotiations and fight for a socialist alternative.
Such an approach would be popular not just in Britain, but across Europe, and could be a first step towards real European solidarity and internationalism - a socialist confederation of the continent as a whole.