At the same time, Russia’s external environment was changing. The former republics of the USSR (except for a few) were all moving off into independent trajectories, and worryingly for the Kremlin, closer to the West and to NATO. Russia has always considered these republics to be the sort of buffer zone for the motherland, and is not likely to easily accept the borders of NATO extending to these territories. In addition, the former Communist countries outside the USSR have also moved closer to NATO, putting more pressure on the Kremlin. The proposed measure of the US to have missile defense establishments of many of these countries (currently a deal signed with Poland) is making Russia see totally red. In this context, the provocation of the Georgian first step and the all out Russian response shook the US and European countries; further, Russia is not easily giving in, only hesitatingly accepting a ceasefire, and on its terms. All this now leads to a debate in the West about how should they deal with Russia:

What do you do with an angry bear? Growl back at him, face him down or threaten to take away his honey? It is a debate the NATO countries are patently having trouble resolving. The 26 member nations of NATO agree that the Russian invasion of Georgia in response to Tbilisi’s military action in South Ossetia, whatever the provocation, seriously overstepped the mark. But the meeting of NATO’s foreign ministers to discuss what to do about an increasingly assertive, not to say belligerent, Moscow has served only to demonstrate the inability of the alliance to come to firm conclusions and to take decisive action.
The NATO nations remain divided between those who ache to take a swipe at Vladimir Putin and Dimitri Medvedev and the pragmatists who say that NATO, the EU and the U.S. simply have to find a way of doing business with a new-style Russia that has not, as the West had hoped, come to share their values and which has been emboldened by its new energy riches to demand a controlling influence on the countries close to its borders. But what sign was there of a slap over the wrist for Russia, let alone a “concrete step” that deprived Moscow of its easy-odds victory? If the toughest warning Europe can offer in the present situation is to threaten a meeting of EU heads of government to review relations with Russia, then Messrs. Putin and Medvedev will hardly be phoning their medics to ask for pills to help them get their beauty sleep.

Russia has drawn a line in the sand with its current campaign in Georgia. Further, it has totally opposed the US-Poland missile defense deal, and is in the position of making international cooperation that the US desires much more difficult. It will also suffer, but can make things much more difficult for the West overall. Threatening Russia is not going to get the West anywhere, unless it is prepared to suffer the consequences.

This much movement must have been expected by the West, but this was not it. Russian forced moved out from these territories and moved towards the strategic city of Gori, a city that sits on the central part of Georgia. Georgians considered this move as an attempt to split the country into 2 separate sections and hollered mightily, expecting action from their allies (the West and the United States). The United Nations was out since Russia would have vetoed any such resolution. And the United States depends on Russia to help it on Iran (something that is more important than the action in Georgia), so except for calling for a cease-fire and speaking about how this action of Russia would have far-reaching consequences, it was not able to do anything greater.
It was Russia that is deciding the course of actions, and one is waiting to see how its other interest, of preventing an oil pipeline that would remove Russian influence from oil shipments will play through. In this case, the West can only try and hope that it will be able to influence Russia, and even though a cease-fire is now signed, Russian troops are not currently retreating:

A day after Secretary of State Condoleezza Rice went close to the front lines in Georgia to press for immediate withdrawal of Russian forces there, the Kremlin announced Saturday that it had approved a framework for a cease-fire. On the ground in Georgia on Saturday, the situation remained largely unchanged, with Russian troops occupying large swaths of territory. The Kremlin gave no indication when they would be pulled out.
The six-point arrangement had been negotiated by the French president, Nicolas Sarkozy, but a dispute soon followed over one of its provisions, which the Russians had interpreted as allowing them to maintain a military presence on Georgian territory outside the two disputed enclaves, South Ossetia and Abkhazia. The vagueness of the original provision appeared to have allowed the Russians to occupy Gori even after the two countries had agreed to the cease-fire framework. A senior Western diplomat in Tbilisi, speaking on the condition of anonymity under normal diplomatic rules, contended that the Russian military maneuvers near the capital on Friday around the time of the Rice visit were deliberate. The diplomat said troops were “moving around to weaken the civilian administration and perhaps create the conditions for political upheaval down the line.”

For all the bluster that Rice and other leaders could raise, it was clear that the initiative lay with Russia. Both Russian Prime Minister (and true force behind the throne) Vladimir Putin and President Dmitri Medvedev had raised the stakes very beginning with the fast deployment of Russian forces, with some pointed comments and speeches, and with not stopping at the border of South Ossetia, but taking the fight inside Georgia.

So, when Ukraine tried to show itself as more hostile towards Russia, there was a sudden crippling blockade of the oil and gas it gets from Russia; and now Georgia. Ever since President Mikheil Saakashvili came to office and had a campaign of getting back the pro-Russian provinces of South Ossetia and a second separatist area, Abkhazia, Russia has been seething. It already knows that it is much more powerful. The US wants its support in the initiatives against Iran and North Korea, and cannot afford to antagonize Russia. And the Georgian leader gave Vladimir Putin just that chance. He tried to take one of the provinces, South Ossetia back, and met such overwhelming Russian force (without any check by any other party) that Western leaders were worried that Putin may be trying to gain more geographic control inside Georgia. Right now, things are moving towards a cease-fire, but Russia must have intended this as a show of force to Georgia and others, that they are truly helpless when faced with this great bear.