When is a victory a defeat? Labour won its best local election results in London – and the Tories their worst results – since 1971. Although the Tories largely benefited nationally from the implosion of Ukip, as things stand, Labour have dozens of net gains. That doesn’t mean Labour doesn’t need to learn lessons and act on them (it does) or that these results are good enough (they’re not). But the surreal triumphalism of Tories and pundits – who are desperate to return to a world before Jeremy Corbyn’s Labour won 40% of the vote and ended a generation-old political consensus – is almost pitiful.

Firstly, campaigning works. The Tories and their allies, petrified of Labour’s mass membership when their own party has slumped to a billionaire-funded husk – are desperate to portray Momentum’s massive mobilisation of activists as a failure. Their aim? To discourage politically enthused young people from campaigning against the Tories. But everywhere Momentum went (with an important exception, Barnet), Labour won gains, some big. In Trafford, the Tories lost control of the council, much to the surprise of Labour, who had briefed me that that was an impossible target. Labour has become the biggest party there, with its vote share surging from 38.2% to 47.3%. Momentum’s campaign day was “pivotal in ousting the Tories here”, one party activist tells me.

In Portsmouth – another Momentum target – where only a third of the council was up for grabs, Labour won four new seats and a 12-point surge in vote share. As one BBC journalist tweeted it: “Labour jubilant in Portsmouth, vote up substantially after Momentum turned out four times the usual number of campaigners, now winning seats they’ve never won before.” In Wandsworth and Westminster, Labour won its highest number of seats since 1986 and a share of the vote almost level with the Tories. In fact Wandsworth only stayed under Tory control by a measly 80 votes. In the case of Westminster, Labour’s vote share went up by about eight points to over 41%, even if that doesn’t translate into seats due to a ludicrously unfair electoral system. In Swindon, Labour’s share of the popular vote rose from 32.2% to 42.4%, higher than the Tories and putting the party in good stead for winning one of the two parliamentary constituencies in a general election. Plymouth council was a Labour gain, thanks to the campaigning of Momentum and non-Momentum activists alike. The Tories have every reason to fear the grassroots mobilisation Momentum can deliver – because it works. The deputy chairman of the Conservatives, James Cleverly, asked: “Are those Momentum activists actually putting people off voting Labour?” That’s obviously ludicrous.

But Labour have real problems to address. Barnet was lost because many Jewish voters – as well as their friends and neighbours – fear the antisemitic fringe on the left. Labour has failed to properly address and defeat this fringe, and a wider culture of denial and complacency exists on the left. Antisemites have to be driven out of Labour, every single one. Labour’s new general secretary, Jennie Formby, has made this a priority: the full implementation of Shami Chakrabarti’s recommendations must now follow.

There is also the wider problem of Labour’s support base – particularly younger voters – being so much less likely to vote than older affluent Tory voters, especially in local elections: that must be addressed. Increasing youth turnout isn’t enough, though – the party desperately needs to increase its appeal among older voters.

It is difficult to conjure enthusiasm about local elections, full stop. Local authorities have such limited powers, and have been decimated by cuts, so it’s also much harder to offer the sort of radical policies Labour offered in the election and which turned its fortunes around. The party needs to advocate for radical devolution of powers so councils actually have teeth.

There must also be reflection on the lack of political momentum since the election. Labour needs to recapture the sense of insurgency it exuded in last year’s campaigning. That’s difficult without parliament being dissolved again: Labour can’t otherwise benefit from broadcast impartiality rules that would grant it unfiltered access to the public, or a massive uptick in political interest which is a precondition for a viral social media campaign. The party needs to pick some fights that emphasise dividing lines with the Tory party.

Labour’s expectations management was poor, too, and that’s partly why victories – which have built on Labour’s general election result – are being presented as defeats.

Nonetheless, a warning to the Labour leadership’s ideological enemies: for you, 8 June 2017 was a bad dream, an aberration, a troublesome spirit to be exorcised. But it isn’t going away. A year ago, before that general election, Labour got pummelled in local elections, winning a derisory 27% of the vote. Four weeks later it deprived the Tories of a majority and captured 40% of the vote. The hubris that helped steal away the Tory majority is back, as if the general election had never happened. It is pitiful, and may prove the downfall of the entire Tory establishment.

• Owen Jones is a Guardian columnist