it???

Below is a translation work I'm doing. But I cannot figure out what the author is talking about in the last long sentence marked as blue by me. Besides, I'm dying to know what the pronoun it therein refers to.

"To write about the modernist novel, as opposed to the Victorian novel, say, or the Edwardian novel, is to write not only about the possibilities of the genre, but about its perceived impossibility. The possibilities were evident enough. From about 1890 to about 1930, the novel was as popular as it had been during the Victorian period, and newly diverse. According to Henry James, in 1899, it was a universally valid form, “the book par excellence”; according to Ford Madox Ford, in 1930, it was indispensable, “the only source to which you can turn to ascertain how your fellows spend their entire lives.” And yet there was also a feeling, more prevalent among writers than among critics, that the novel as traditionally conceived was no longer up to the job: that its imaginary worlds did not, in fact, correspond to the way one’s fellows spend their entire lives. The felling was most fully and influentially articulated by T.S. Eliot, when he argued that the novel had effectively “ended” with Flaubert and James: that the very formlessness which had once made it the adequate “expression” of a previous age, an age not yet formless enough to require “something stricter,” now prevented it from expressing a modernity characterized above all by the loss of form."