So what to do?
The EU want to impose harsh austerity for years to come until an acceptable repayment is made.

Most Greeks are not prepared to endure that.
They could just default and start again, with their own currency if necessary.
Argentina defaulted on its debts a few years ago, and is now doing OK.

If Greece does it and does OK, Spain and Portugal might follow them.

That would increase the burden on France and Ireland.
The whole thing could unravel.