"Better deal" meaning "a deal which doesn't involve breaking promises they made to the electorate".
Clearly such a deal wasn't possible, hence here we are.
The idea that this is somehow blackmail is ludicrous.
I think that if the successive government also reneged upon its promise, that would signal the true end of democracy is Greece.
The main difference is, of course, that it wasn't clear that it would be impossible to end austerity, with some thinking that the Troika would give in. But that doesn't mean the end of democracy.
It basically signaled that the Troika will cajole, threaten, blackmail and generally do everything in their power to keep the austerity train going.
Ultimately, though, that's the way to destroy the currency union. An economic policy based upon wage suppression and privatization of monopoly industries is nice for some people, but it isn't sustainable.
Given the way that the negotiations are going, they were essentially faced with a choice of slashing pensions and wages to the bone (wouldn't have helped with paying the debt back, incidentally) or... plan B.
Right now, Greece is stuck between a rock and a hard place: agreeing to the Troika’s demands for continued austerity and see another 5 years of economic depression with no end in sight in a way that sells out their campaign promises, vs. leave the Eurozone and see possibly immediate even more dramatic economic collapse but with a potential way out of the mess through a currency under Greek control more appropriate exchange rates.