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The Greeks came to edge of the precipice but at the last minute stepped back. The June 17 election was a close race. The centre-right, pro-bailout New Democracy party won by a mere 3 per cent over the radical left anti-austerity Syriza Party. Although the narrow victory of New Democracy is support for the euro zone, a large segment of the population despises the EU imposed austerity measures.

Like most Europeans, the Greeks applauded the establishment of the euro zone in 1999 and rushed to join the monetary union in 2001. Francois Mitterrand and Helmut Kohl, respectively president of France and chancellor of Germany, were the visionaries behind the euro zone. Both men believed that the EU, followed by the euro zone, would guarantee no future wars on the European continent and bring about a United States of Europe. Kohl and Mitterrand had lived through the horrors of the Second World War and placed their faith in the belief that a united Europe would ensure peace.

Although the euro zone was to be the precursor for European unity, little was done other than the printing of Euro notes. The euro zone eventually came to include 17 EU countries; major powers like Germany and France; and financially weaker states like Greece and Portugal.

Initially, the euro zone countries prospered but this new-found wealth was the false dawn of a new era. Despite the fact that the euro zone financially chained together all 17 members, few efforts were made to provide an economic safety net. The euro zone neither has a pan-European central bank nor a finance ministry with the power to regulate the budgets and deficits of its members.

In effect, the euro is a currency without a home and subject to the political whims of each of its members. It was only a matter of time before the inequities of the EU partners triggered a crisis. Ten years after the euro zone was created France, Spain, Ireland, Italy, Portugal and Greece were facing massive deficits.

Greece quickly became the focal point of the crisis because it was the first euro zone country whose debt reached 113 per cent of its GDP. It soon became evident that Greece had "cooked the books" in 1999 to qualify for euro zone membership. The Greeks had help falsifying their financial records from the now defunct Lehman Brothers. The bureaucrats in Brussels paid scant attention to the Greek application so that the euro zone's borders would be contiguous with the geographic boundaries of Europe. Sadly, geography trumped economic common sense and honesty.

As a result, within 10 years, Greece faced economic collapse and received a €110-billion bailout. But the bailout came with an austerity package that has reduced Greece to near financial and social collapse. Austerity measures were also imposed on Portugal and Ireland with corresponding misery on their populations. The policies of the EU, IMF, and the Central European Bank were to use the bailouts as leverage and force Europe's financial miscreants to re-structure their economies.

The plan did not take into account the social carnage the austerity measures would have on Greece and the other recipients. Unemployment hit 30 per cent, salaries and pensions were dramatically reduced, and strikes and demonstrations became daily features. Hospitals have begun to run out of critical medical supplies and homelessness and hunger have increased dramatically.

The impact of all these changes ravaged Greek society and in turn caused many people to seek solace in the extreme ends of the political spectrum. Almost overnight radical parties took centre stage. For the first time, Golden Dawn, a neo-Nazi style party actually acquired 17 seats in parliament. Syriza, a coalition of 17 left-wing parties, emerged as a major factor in the Greek body politic. Its popularity rests almost exclusively on a platform promising to terminate the EU austerity measures. Indeed, the Greek election was fought over one issue – the austerity measures.

It is not surprising that for several days the EU held its breath while awaiting the results of the Greek election. If Syriza had formed the government there is every probability that its hardline policies could have resulted in a Greek exit from the euro zone and all its ensuing consequences for Europe and the rest of the world. Nevertheless, the Greek and euro zone crisis is far from over. The New Democracy coalition will only survive if it can ameliorate the harshness of the EU austerity measures. Failure will return the Greeks to the edge of the precipice and next time they may just leap into the unknown.

André Gerolymatos is Director of the Stavros Niarchos Foundation Centre for Hellenic Studies at Simon Fraser University in Vancouver