The country can't pay its debts, and the upcoming referendum will decide whether they face increased austerity measures or start the process of exiting the Euro and face even worse austerity.
Leaving the Euro will mean that the country has defaulted, and whatever currency they put in place will have no value at all. The government will be bankrupt and will not be able to pay civil servants or pensioners. There are only 3 ways this goes:
- Creditors accept to write-off some of the debt. They cut their losses and allow Grece to survive, in a situation which is actually bearable.
- More austerity, from inside the euro. Hard times ahead.
- Default. Chaos, Civil War.
Humanity and Finance don't go together very well...