Western papers are bowing down to Putin's ruthless brilliance--he has shown the West that he is only to be pushed so far, that he will strike when he can, and that there is little the West can do about it short of declaring war.
The Americans are flailing a bit to show that they are not helpless, by sending aid via the US military in the Black Sea--surely they are not, in a military capability sense. But there is a willpower problem, and Russia knows it. The US public is not currently prepared to open a Caucasus front to defend Georgia, and Europe never has been. Like all thug powers before it, Russia will continue to do what it can get away with. Luckily for Russia, Putin is absolutley brilliant--much more so than a Hitler or a Khrushchev. Russia is reasserting its will over its periphery, and all that the Americans can do is condemn, all that the French can do is ask nicely, and all the rest of Europe can do is cower helplessly as the Russian bear stands up.
But this smack to the face of the West is not done--Russia has come back for the other cheek. The Russians have occupied Gori and stood by with tanks as South Ossetians looted and burned it into the ground--in defiance of a cease-fire agreement made with the EU and promised publicly by Medvedev. Why do this? Part of it is to punish Georgia, and to force their citizens to see that electing a president with too much hubris will bring them great pain. Part of it is to ensure the loyalty of the Ossetians for years to come. But mostly, it is a terrifying cackle to the West that Russia can do this if it wants to, simply because it wants to. It needs not follow cease-fires, it needs not listen to rebukes or threats, it needs listen to the West only as much as the West will listen to Russia--which, for the past 17 years, has been very little indeed. The West should indeed be shaking now, and unless Sarkozy can rally the EU out of its lethargic quagmire of indecision and white-flag politics, the Russians are going to throw temper tantrums every time they want their way--and they will get it. The US surely can't stand against the Russians with an unpopular Bush in power--McCain stands vehemently against any Russian interest, but he won't be able to do much without either ending the Middle East conflicts or inspiring the EU--the latter of which is highly unlikely, given current US popularity.
In the short-term, Russia may be turning next to the Ukraine. Losing the Ukraine to NATO would make an integral part of historical Russia an untouchable spectre, like a blade deep in its agricultural belly. Russia is making its moves to prevent NATO's final enclosure of Russia, and it couldn't come at a better time: The EU is fractured and disillusioned after the Irish "No" vote, the US executive branch has 3 full months before it can rally behind a desperately-needed new leader, and Western troops are all bogged down in the Middle East--angry words are the best the West can currently muster.
The only hope for checking Russia at this point is for NATO to put the Ukraine and Georgia on the fast-track to membership, and be prepared to deal with the consequences. The biggest problems are the Germans, who are less likely than the French executive to swallow a cut-off of Russian energy resources. But like thug powers before it, Russia will be emboldened by NATO's unwillingness to respond, and Putin will casually return from Beijing to a nervous, young Medvedev smiling, to say: "See? I told you they were worms."