Actually, they clearly understand that simple austerity isn't going to correct the situation.
Correcting the situation was never on the table. Greece F***ed up royal, and now the time has come to pay the piper. Their creditors insisted that they had to implement austerity to stop spending more money than they had in exchange for temporary loans. The alternative is enforced austerity vis-a-vis no more money to spend. Period. One way or another, the Greek people are going to balance their budget. Their apparent unwillingness does not change the fundamental reality they have to face. The other countries in EU, ECB, IMF are / were under no legal obligation to bailout Greece. Now, thanks to the Syriza governments popularly mandated behaviour, and their wholesale destruction of the Greek economy, Europe no longer has a moral obligation to Greece either, and there is nothing much more that Greece can do to financially harm Europe. The Damage has been done, let the Greeks drown in it.