ATHENS, Greece – Greek lawmakers today approved harsh new austerity measures demanded by bailout creditors to save the debt-crippled nation from bankruptcy, after riots in Athens and other cities left stores looted and burned and more than 120 people hurt.

The historic vote paves the way for Greece’s European partners and the International Monetary Fund to release $170 billion in new rescue loans, without which Greece would default on its mountain of debt next month and likely leave the eurozone — a scenario that would further roil global markets.

Lawmakers voted 199-74 in favor of the cutbacks, despite strong dissent among the two main coalition members.

In response, the Socialists and conservatives expelled 22 and 21 lawmakers, respectively, reducing their majority in the 300-seat parliament from 236 to 193.

Violence was reported in six other cities, the worst in central Volos where the town hall and a tax office were damaged by fire, police said.

Sunday’s clashes erupted after more than 100,000 protesters marched on parliament to rally against the drastic cuts, which will ax one in five civil service jobs and slash the minimum wage by more than one-fifth.

At least 45 businesses were damaged by fire, including several historic buildings, movie theaters, banks and a cafeteria, in the worst riot damage in Athens in years. Fifty police officers were injured and at least 70 protesters were hospitalized. Sixty-seven suspected rioters were arrested and a further 70 detained.

Prime Minister Lucas Papademos urged calm.

“Vandalism and destruction have no place in a democracy and will not be tolerated,” Papademos told Parliament just before the vote. “I call on the public to show calm. At these crucial times, we do not have the luxury of this type of protest. I think everyone is aware of how serious the situation is.”

Since May 2010, Greece has survived on a $145 billion bailout from its European partners and the International Monetary Fund. When that proved insufficient, the new rescue package was approved. The deal, which has not yet been finalized, will be combined with a massive bond swap to write off half the country’s privately held debt.

But for both deals to materialize, Greece had to persuade its deeply skeptical creditors that it has the will to implement spending cuts and public sector reforms that will end years of fiscal profligacy and gaping budget deficits.

As protests raged Sunday, demonstrators set bonfires in front of parliament and dozens of riot police formed lines to keep them from making a run on the building. Security forces fired dozens of tear gas volleys at rioters, who attacked them with firebombs and chunks of marble broken off the fronts of luxury hotels, banks and department stores.

Clouds of tear gas drifted across the square, and many in the crowd wore gas masks or had their faces covered, while others carried Greek flags and banners. Masked rioters also attacked a police station with gasoline bombs and stones.

A three-story building was consumed by flames as firefighters struggled to douse the blaze. Streets were strewn with stones, smashed glass and burnt wreckage, while terrified passers-by sought refuge in hotel lounges and cafeterias.

Scores of bat-wielding youths smashed property at will for several hours, leaving broken traffic lights hanging from poles, and chairs and tables from looted coffee shops dumped on the street. Ambulances weaved through narrow backstreets to ferry the injured to hospital, dodging burning trash bins and the running battles between rioters and police.

“I’ve had it! I can’t take it any more. There’s no point in living in this country any more,” said a distraught shop owner walking through his smashed and looted optician store.

Athens Mayor Giorgos Kaminis said rioters tried to storm the City Hall building, but were repelled. “Once again, the city is being used as a lever to try to destabilize the country,” he said.

In parliament, Finance Minister Evangelos Venizelos said the new austerity measures were vital to the country’s economic survival.

“The question is not whether some salaries and pensions will be curtailed, but whether we will be able to pay even these reduced wages and pensions,” he told lawmakers. “When you have to choose between bad and worse, you will pick what is bad to avoid what is worse.”

The new cutbacks, which follow two years of harsh income losses and tax increases amid a deep recession and record high unemployment, have been demanded by Greece’s bailout creditors in return for a new batch of vital rescue loans.