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William.
I can't see any way out of this for Labour. The Blairites abandoned the working classes (and Scotland) in favour of austerity policies, chasing the middle england vote and allowed the narrative to be dictated to them by the Tories, UKIP, and the media (Labour caused the financial crash, Austerity is needed, Immigration is a problem etc).
The grass roots elect a leader who is anti-austerity, and his message is drowned out by continuing back stabbing by his own party, and by a media who don't want to stray from the neoliberal path. Guardian in particular had some awful articles around the time of Labour leadership contest, and seems to reporting the last days events with glee.
If Labour do have a new leader, it'll probably be an ex-policy wonk/spod from this list.
http://www.independent.co.uk/news/uk/politics/these-are-the-184-labour-mps-who-didn-t-vote-against-the-tories-welfare-bill-10404831.html
I can only hope that the grass roots support for Corbyn shows that they can't carry on down the Tory-lite / Pro-Austerity path