President Obama has warned Russia that “there will be costs” for a military intervention in Ukraine. But the United States has few palatable options for imposing such costs, and recent history has shown that when it considers its interests at stake, Russia has been willing to pay the price…

The administration could impose the same sort of banking sanctions that have choked Iran’s economy. And yet Europe, with its more substantial economic ties, could be reluctant to go along, and Mr. Obama may be leery of pulling the trigger on such a potent financial weapon, especially when he needs Russian cooperation on Syria and Iran.

“What can we do?” asked Fiona Hill, a Brookings Institution scholar who was the government’s top intelligence officer on Russia during the Georgia war when Mr. Putin deflected Western agitation. “We’ll talk about sanctions. We’ll talk about red lines. We’ll basically drive ourselves into a frenzy. And he’ll stand back and just watch it. He just knows that none of the rest of us want a war.”

A president who has made clear to the American public that the “tide of war is receding” has also made clear to foreign leaders, including opportunists in Russia, that he has no appetite for a new one. What is left is a vacuum once filled, at least in part, by the possibility of American force.

“If you are effectively taking the stick option off the table, then what are you left with?” said Andrew C. Kuchins, who heads the Russia and Eurasia Program at the Center for Strategic and International Studies. “I don’t think that Obama and his people really understand how others in the world are viewing his policies.”

Rarely has a threat from a U.S. president been dismissed as quickly — and comprehensively — as Obama’s warning Friday night to Russian President Vladi­mir Putin.

Why did Obama publicly state that aggression in Ukraine would trigger “consequences”? Clearly he was telling Putin to recalculate the potential costs and benefits of an invasion. But Obama was ignoring a simple fact: Putin would incur almost any risk to avoid losing Ukraine. To put it another way: There are no consequences—none that the United States could credibly threaten—that would keep Putin from doing whatever it takes to hang on to Ukraine.

More often than not, Obama has acted like a foreign-policy realist in the five years of his presidency. In his public statements on Ukraine these past 24 hours, he has not. Rather, he has drawn another “red line” that the threatened party feels it’s worth the risk to ignore…

Neither side wants an escalation in violence and disorder. The question is how much each side is willing to accept an escalation in the pursuit of its vital interests. And in that equation, Obama and the EU do not hold strong hands.

“Stop going on television and trying to threaten thugs and dictators,” Graham said. “It is not your strong suit. Every time the president goes on national television and threatens Putin or anyone like Putin, everybody’s eyes roll, including mine. We have a weak and indecisive president that invites aggression.”

“President Obama needs to do something. How about this — suspend Russian membership in the G8 and the G20, at least for a year, starting right now. And for every day that they stay in Crimea, add to the suspension. Do something.”

“Yesterday, from various media, we heard how U.S. President Obama declared that Russia would dearly pay for her politics,” Yury Vorobyov, the body’s deputy speaker, told an emergency session called to hold the war vote. “I think these words of the U.S. president are a direct threat, and he crossed a red line, he insulted the Russian people.”

The phrase “red line” was no accident, and not one thrown around often in Russia. It was a direct reference to Obama’s much pilloried foreign policy disaster over Syria, something largely forgotten at home but constantly referenced abroad — from Moscow to Tel Aviv to everywhere in between…

The question now is whether Obama can look towards the long-term. Obama has tried to play nice with Russia, and been rebuffed at every turn. Russia will never cooperate on Syria. It will eventually try to disrupt Obama’s “reset” with Iran. Putin has turned anti-LGBT into a tool of foreign policy. Now he is sending troops into Ukraine.

Obama has made dialogue and cooperation a cornerstone of his approach to the world. But what if some countries don’t reciprocate?

Too much of the Washington policy establishment looks around the world and sees only reflections of its own enlightened self. That’s natural and perhaps inevitable to some degree. The people who rise through the competitive bureaucracies of American academic, media and think tank life tend to be those who’ve most thoroughly absorbed and internalized the set of beliefs and behavioral norms that those institutions embody and respect. On the whole, those beliefs and norms have a lot going for them. It would not be an improvement if America’s elite institutions started to look more like their counterparts in Russia or Zimbabwe.

But while those ideas and beliefs help people rise through the machinery of the American power system, they can get in the way when it comes to understanding the motives and calculations of people like President Putin. The best of the journalists, think tankers and officials will profit from the Crimean policy fiasco and will never again be as smug or as blind as so much of Washington was last week. The mediocre majority will go on as before.

We didn’t think Putin would do this. Why, exactly? This has often puzzled me about Western analysis of Russia. It is often predicated on wholly Western logic: surely, Russia won’t invade [Georgia, Ukraine, whoever’s next] because war is costly and the Russian economy isn’t doing well and surely Putin doesn’t want another hit to an already weak ruble; because Russia doesn’t need to conquer Crimea if Crimea is going to secede on its own; Russia will not want to risk the geopolitical isolation, and “what’s really in it for Russia?”—stop. Russia, or, more accurately, Putin, sees the world according to his own logic, and the logic goes like this: it is better to be feared than loved, it is better to be overly strong than to risk appearing weak, and Russia was, is, and will be an empire with an eternal appetite for expansion. And it will gather whatever spurious reasons it needs to insulate itself territorially from what it still perceives to be a large and growing NATO threat. Trying to harness Russia with our own logic just makes us miss Putin’s next steps…

Putin and those around him are, fundamentally, terminal pessimists. They truly believe that there is an American conspiracy afoot to topple Putin, that Russian liberals are traitors corrupted by and loyal to the West, they truly believe that, should free and fair elections be held in Russia, their countrymen would elect bloodthirsty fascists, rather than democratic liberals. To a large extent, Putin really believes that he is the one man standing between Russia and the yawning void. Putin’s Kremlin is dark and scary, and, ultimately, very boring…

Russia’s next target is eastern Ukraine. Because pessimism conquers all, don’t bet that Putin is going to stop once he wrests Crimea from Kiev’s orbit. Eastern, Russian-speaking Ukraine—and all its heavy industry—is looking pretty good right now. And if you’re thinking “Why would Putin take eastern Ukraine?,” well, you haven’t been reading very carefully.

Any [Russian] invasion—which is what it would be—of a vast country of 46 million in the heart of Europe, sharing borders with NATO allies Poland, Hungary, Slovakia and Romania, would pose a major security challenge for the United States and other key European powers. Even without further Russian action, allies such as the Baltic countries will be seeking U.S. reassurance. Lithuania has already asked for Article IV consultations under the NATO Treaty in response to a clear threat to its security. These countries likely will also ask for hard reassurances—such as deployments of U.S. and other allied troops and equipment on their territory—as Turkey did in 2012 when Syria shot down a Turkish jet. They will also need help to shore up their eastern borders and prepare for possible flows of refugees from Ukraine. The Baltic states will probably ask for similar reassurances. One can also expect cyber attacks and intrusions, false alarms and an atmosphere of tension the likes of which have not been seen since the worst days of the Cold War…

The break in the West’s relations with Russia is bound to be deep and lasting. The G-8 will be its first casualty with the Western powers likely to reconstitute the G-7 in its original form as a direct rebuff to Putin. Other important international mechanisms —the U.N. Security Council, ad hoc diplomatic efforts on Syria, the P5+1 process on Iran, the Six-Party talks on North Korea, and so on—will be filled with renewed acrimony and dysfunction. Some may break down entirely. Inevitably, there will be congressional calls for sanctions against Russia, which the White House will be hard-pressed to resist no matter how much it may want to preserve the shreds of cooperation with Russia on Iran, Syria or Afghanistan. The West and Russia are in uncharted waters.

The Crimea crisis will not pass soon. Kiev is unlikely to agree to Crimea’s secession, even if backed by clear popular will: this would be discounted because of the “foreign occupation” of the peninsula. The crisis is also expanding to include other players, notably the United States. So far, there has been no military confrontation between Russian and Ukrainian forces, but if they clash, this will not be a repeat of the five-day war in the South Caucasus, as in 2008. The conflict will be longer and bloodier, with security in Europe put at its highest risk in a quarter century.

Even if there is no war, the Crimea crisis is likely to alter fundamentally relations between Russia and the west and lead to changes in the global power balance, with Russia now in open competition with the United States and the European Union in the new eastern Europe. If this happens, a second round of the cold war may ensue as a punishment for leaving many issues unsolved – such as Ukraine’s internal cohesion, the special position of Crimea, or the situation of Russian ethnics in the newly independent states; but, above all, leaving unresolved Russia’s integration within the Euro-Atlantic community. Russia will no doubt pay a high price for its apparent decision to “defend its own” and “put things right”, but others will have to pay their share, too.

Born in tandem with the nuclear age, the Cold War was defined from the outset less by outright confrontation than by caution. And with caution came adjustment, compromise, improvisation and at times retreat. As often as not, both sides blinked…

A year later [in 1956], when Moscow sent two Red Army tank divisions to quell anti-Communist protesters in Budapest, killing as many as 30,000 people, the cry went up for action. “What are the West and the United Nations going to do?” one despairing protester asked an American reporter.

The answer: nothing. Counteraction would only provoke Moscow to tighten its noose and perhaps “go back on de-Stalinization,” Eisenhower explained…

Calculations like these are the true prologue to the approach that Mr. Obama seems to have adopted in trouble spots from Syria to Ukraine.

Ukraine isn’t a country: it’s a Frankenstein monster composed of pieces of dead empires, stitched together by Stalin. It has never had a government in the Western sense of the term after the collapse of the Soviet Union gave it independence, just the equivalent of the family offices for one predatory oligarch after another–including the “Gas Princess,” Yulia Tymoshenko. It has a per capital income of $3,300 per year, about the same as Egypt and Syria, and less than a tenth of the European average. The whole market capitalization of its stock exchange is worth less than the Disney Company. It’s a basket case that claims to need $35 billion to survive the next two years. Money talks and bullshit walks. Who wants to ask the American taxpayer for $35 billion for Ukraine, one of the most corrupt economies on earth? How about $5 billion? Secretary of State Kerry is talking about $1 billion in loan guarantees, and the Europeans are talking a similar amount. That’s not diplomacy. It’s a clown show…

What should we do (or what should we have done)? It’s obvious that the Ukrainians have no faith in their democratic institutions, having staged a coup against a democratically elected president. In that case, the next step is constitutional reform. The existing system has broken down and the people should choose a new one. But constitutional reform has to take into account the prospect of partition. Lviv and Sevastopol have about as much in common as, say, Bogota and Montreal. The West should encourage the Ukrainians to amend their democratic institutions in order to achieve a national consensus, which might mean a different sort of nation. If Crimea, for example, were to vote for partition, why object? If it voted against partition, that would put Putin on the spot. The West would have come off better by getting in front of the events rather than chasing them.

Russia sees an America distracted: Putin’s Ukrainian gambit was a shock to the U.S. foreign policy establishment. They prefer talking about China, or participating in Israeli-Palestinian peace talks. Russia sees an America vulnerable: in Afghanistan, in Syria and on Iran—a United States that desperately needs Russian support to continue shipping its supplies, host any peace conference or enforce its sanctions…

[Putin] knows that millions of Russians will cheer him as a hero if he returns them Crimea. He knows that European bureaucrats will issue shrill statements and then get back to business helping Russian elites buy London town houses and French chateaux. He knows full well that the United States can no longer force Europe to trade in a different way. He knows full well that the United States can do nothing beyond theatrical military maneuvers at most.

This is why Vladimir Putin just invaded Crimea.

He thinks he has nothing to lose.

“He is not going to gain by this,” Kerry continued. “He may be able to have his troops for some period of time in Crimea unless he resolves this. But the fact is, he’s going to lose on the international stage, Russia is going to lose, the Russian people are going to lose. He’s going to lose all of the glow that came out of the Olympics, his $60 billion extravaganza. He is not going to have a Sochi G8. He may not even remain in the G8 if this continues. He may find himself with asset freezes on Russian business, American business may pull back. There may be a further tumble of the ruble. There’s a huge price to pay. The United States is united, Russia is isolated. That is not a position of strength.”

“Do you have any indication at all that President Putin is taking heed of what President Obama is saying?”

If you look at the White House read out, which I encourage everybody to read and try and piece through the gobbledegook, Obama said Russia was “violating international law.” That’s just about the most serious thing in the world to Barack Obama and its probably on a long list of priorities for Putin, something pretty close to the bottom.