If, you are any kind of well wisher of Greece, the results of last nights election was a horrible result.  The headline result from much of the media was that the Greek electorate voted against "austerity."  There is something to that.  Since 1974, two major parties, the nominally socialist PASOK and the nominally conservative New Democracy have taken turns running Greece.  They built an unsustainable state built on unsustainable debt and eventually the bill came due.  Greece had to borrow to continue to pay its bills, but, for obvious reasons, the sane don't want to lend to the Greek government. Greek has secured a series of loan agreements from the "troika" (The European Commission, the European Central Bank, and the International Monetary Fund.)  In return for the money, the troika has insisted on a series of "memorandums."  The memorandums are promises by the Greek government to implement spending cuts, tax increases and labor market reforms to bring the Greek deficit down to a sustainable level and restore Greek economic competitiveness.  With the economy no longer being floated on unsustainable foreign borrowing, taxes going up, and government spending going down, Greece has seen its GDP decline by 13% and unemployment climb to over 20%

In yesterday's election, the two major Greek parties (who had been governing in coalition as a condition of getting money from the troika), supported the memorandum along with vague promises to negotiate with the troika to modify some of the terms after the election.  Everything was against the two major parties.  They were campaigning as tax raisers and spending cutters.  They were presiding over an economic downturn that was more than twice as deep as our Great Recession of 2007-2009.  And everyone knew that the two "pro-memorandum" parties had driven Greece into this ditch.  The result was that the two major parties saw their share of the popular vote go from over 77% in 2009 to 32% yesterday. 

Due to quirks of the Greek electoral system, the two mainstream "memorandum" parties got 149 seats in Greece's 300 member Parliament.  The problem is that you need 151 seats to form a government and all of the other 151 seats have gone to parties that oppose the memorandum. But the real problem isn't that the Greek electorate voted against the memorandum.  The real problem is that the Greek electorate didn't vote for any policy alternative.  Of the 151 anti-memorandum seats, 26 belong to the Communist Party which has promised not to join a coalition with any other party.  They are content being in opposition and calling for protests until the Revolution.  But even if you could get the Communists to go along, 21 of the 151 anti-memorandum seats belong to the extreme right (and arguably neo-nazi) Golden Dawn Party who are toxic to everybody else.  There is no governing majority to be had among the anti-memorandum parties. 

The anti-memorandum parties also have the example of LAOS to look at.  LAOS  was a right-populist party that was against immigration, skeptical of the EU, and anti-spending cuts.  Basically it was protest vehicle for mostly traditionally right-leaning voters who were against immigration, felt they were being left behind by economic change and who were afraid that Greece was losing its sovereignty and distinct cultural identity.  Yesterday's elections were made for a party like LAOS.  The problem was that LAOS joined the pro-memorandum coalition last year. The party saw its poll ratings crater.  Its leader instructed his MPs to vote against the most recent spending cuts and tax increases, but the damage was done.  LAOS lost its credibility as protest party, saw its vote go down to under 3% (the minimum for winning seats) and will not be represented in the new Parliament.  LAOS' place on the Greek right was taken by the new Independent Greeks Party that got 10% of the vote and Golden Dawn that got about 7%. 

One lesson from LAOS' experience is that they shouldn't have supported the memorandum.  Another lesson is that, when circumstances are bad, any party that is associated with the government is going to be hurt.  The anti-memorandum parties like SYRIZA and Independent Greeks won votes as protest parties. They stop being protest parties if they take part in a weak and likely short-lived multiparty coalition during terrible economic circumstances.  The political incentives are for the anti-memorandum parties to avoid governing responsibility.  The is especially the case for Independent Greeks, whose leader is campaigning on vilifying Germany while promising free lunches to be served by Russia, China and Israel.   This program will not survive contact with reality,

In an earlier era, there would probably be a military intervention in politics.  I doubt that happens now.  The last time the military intervened in 1967, the military still has some legitimacy from its creditable performance in World War II.  I don't see the Greek military having that kind of legitimacy now (thank God.)  The collapse of the military dictatorship in 1974 discredited military government.  The most likely scenario is that Greece defaults on its debt, has to leave the Eurozone, and has to go back to the drachma. Defaulting and going to a Greek currency might not be the worst thing in the world, but it takes positive actions on the part of the government if the shocks of the transition are to be minimized. Greece now looks like it is just going to be paralyzed as the money runs out, reforms aren't implemented and Greece's troika creditors refuse to disburse more funds.  They are probably going to default not as a considered policy choice, but by... default.  Then some combination of parties will probably agree to a government of technocrats to oversee the transition to the drachma, and then new elections as Greeks try to adjust to their new situation. Greek democratic institutions will be strained but will survive.

There was this steel cage wrestling match in the 1980s.  Ric Flair was caught in the narrow space between the ring ropes and the steel mesh of the cage.  Flair's opponent kept hitting him.  With each strike, Flair would bounce into the cage and fall into the ropes where he would dangle out on his feet but still standing.  The Flair's opponent would hit him again and the pattern would repeat.  The play-by-play announcer Jim Ross said, "Flair would go down, if he had somewhere to go."  That is the situation of Greek democracy right now.