Is Kenny Dalglish tarnishing his reputation beyond repair?

The under-fire Liverpool manager returns to St James' Park, knowing his transfer dealings compare unfavourably with Newcastle's prudent policy

Liverpool’s manager, Kenny Dalglish, has received criticism for his ineffective yet expensive transfer policy (Getty Images)

There are kinder environments for Kenny Dalglish to take his faltering reputation as a football saviour this weekend than St James' Park, the closest place he has come to failure in football. Dalglish's chief problem during his 20 months on Tyneside from 1997 was that he wasn't Kevin Keegan, though the boot is on the other foot now. He is the one deemed the Messiah and however he might repel the notion, it is becoming clear that he took an almighty gamble with his reputation by returning to Anfield in the depths of last winter.

Ahead of the match with a club where Dalglish took over in the month of January, briefly flourished but was later undone by the performances of players on whom he spent a lot of his owners' money – there are many symmetries between Newcastle and Liverpool second time around – he was asked whether it had ever entered his mind that he had a lot to lose by leaving a cruise liner in the Gulf to heed Anfield's call last winter. "I think that question was said when I took the job and my answer then was that it was an honour to be asked to come back," he replied. Dalglish is so incapable of retreating from this stonewall stance that heaven knows his honest opinion on anything, though it is hard to believe that in his quieter moments he doesn't yearn for the imperious Liverpool bequeathed to him by Joe Fagan, when he first took over as manager back in 1985.

"Didn't we used to have a team in those days as well?" Dalglish said, to the idea that this is the kind of rebuild job that 1985 wasn't. But Fagan's side had just reached the European Cup final at Heysel, it was countered.

"They lost," Dalglish replied. "I think you should look back at the stats and see how many played in my first season as manager, and how many played the season before."

Dalglish has always felt indignant about the idea that his 1985-86 Double was a product of a rich inheritance. "What made me laugh at the end of such a successful season was the critics saying I had done the Double with a team inherited from Joe. I have total respect for Joe but the Double-winning side wasn't anybody's team but mine," he said years later. But the core – Ian Rush, Ronnie Whelan, Alan Hansen, Mark Lawrenson to name a few – stayed at a club then dominating the English game. John Barnes, Peter Beardsley and John Aldridge came later. Now Dalglish shepherds a side being cast further and further way from the financial might of England's elite by three consecutive years outside of the Champions League and the struggle to build or expand a stadium in line with the model of Arsenal or Manchester United.

All this might be a little easier to bear if Liverpool could only turn up players with the uncanny knack of tomorrow's visitors. When Damien Comolli was appointed director of football in November 2010, those who follow and analyse Liverpool reached deep into the recesses of France's Ligue 1 for clues as to whom they might sign. Sylvain Marveaux's name jumped out immediately given that Comolli, like Liverpool owner John W Henry, adhered to the principles of sabremetrics – finding good value in unlikely places through statistics. But Liverpool reached for the cheque book, signed Andy Carroll and instead it was Newcastle who used the proceeds to sign those French players who were going for a song.

Newcastle's low-key chief scout Graham Carr is, unlike his comedian son Alan, not a particularly chatty man, but his eye for a player has been overlooked by some who don't know Tyneside while Alan Pardew has taken the plaudits. Mike Ashley – with his love of a gamble – has been willing to back Carr's instincts. It meant that Newcastle signed Hatem Ben Arfa, despite his suspect reputation with authority. And that when Ben Arfa was recovering from his double leg break at France's Clairefontaine academy, Newcastle managing director Derek Llambias and club secretary Lee Charnley visited and happened to meet Marveaux. It's never been entirely clear whether a failed medical or cold feet caused 25-year-old's Marveaux's move to Anfield to fail at the last moment. But a Newcastle car was available within an hour to whisk him from Melwood to Tyneside, where he showed genuine signs of promise before suffering a groin strain. Yohan Cabaye, signed because Newcastle spotted a €4m release clause in his contract, and Demba Ba followed the same pattern. Liverpool had Cheick Tiote watched before he also chose Tyneside; a £3.5m move from FC Twente which looks a major bargain now.

Dalglish has spent £115.3m to Newcastle's £26.3m – a fifth of the Liverpool figure – in the past 14 months – yet on players who were no secret, at the top end of the market, and who, in the case of Charlie Adam and Stuart Downing, have gone from the top of their previous clubs into seasons at Liverpool which have not improved them. Jordan Henderson needs a less rarefied environment to develop. Craig Bellamy has been the one undeniable success.

Dalglish was unwilling to reflect on Newcastle's reinvestment of the Carroll cash. "I'm not going to sit here and wax lyrical about somebody we are going to play against on Sunday, am I?" His inference was clearly that Liverpool's commitments in the League Cup and FA Cup have made the difference. "They went out of the two cups relatively early so they only had the league to concentrate on and I think that will have helped them as well," he said. The achievement is attributable to a lot more than that.

For a manager who has always rooted himself among the players – his relationship with them survived all outside pressures when the Newcastle job imploded – what shocked about Liverpool's 2-1 home defeat to Wigan Athletic last weekend was their inability to produce a reaction to defeat at Queen's Park Rangers from a two-goal winning position three days earlier. "The Wigan game's been done and dusted. If you wanted to ask a question about the Wigan game you should have asked that afterwards. I was stood at the door," Dalglish said – shutting that one down.

He has periodically suggested that luck is all that Liverpool – eight points adrift of Newcastle – are lacking and, after Wigan, enigmatically suggested that the "philosophy" might be wrong. "The philosophy is the way we approach the game and maybe our education in how to win a game," he said, when asked to expand yesterday. "We don't need to be the attractive passing team we want to be. Sometimes we've got to be more ruthless. It is all part and parcel of learning. We can win a game but you've also got to learn how not to lose a game. Maybe we [the coaching staff] have got to learn, as well as the players." He seemed to be saying that the way Liverpool have always done things must change, though in the past few weeks it is hard to discern any philosophy at all. Early days – but that gamble currently looks like a losing one.

Red or black? How the signings compare

Liverpool:

L Suarez Ajax £22.8m

A Carroll Newcastle £35m

J Henderson Sunderland £16m

C Adam Blackpool £9m

S Downing Aston Villa £20m

Doni Roma free

J Enrique Newcastle £5.5m

S Coates Nacional £7m

C Bellamy Manchester C free

Total spend since Kenny Dalglish took over in January 2011 £115.3m

Newcastle United:

H Ben Arfa Marseilles £5m

S Kuqi Swansea free

D Ba unattached free

S Marveaux Rennes free

Y Cabaye Lille £4.3m

G Obertan Man United £3m

Santon Internazionale £5m

P Cissé Freiburg £9m

Total spend £26.3m