In any normal country, an event like the shooting down of Malaysian Airlines Flight MH17 would have resulted in, at the very least, a pause in overt military activity that might give rise to another such atrocity.  But in Vladimir Putin’s Russia, by no means a normal country, there was only one possible course of action: escalation.

Igor Strelkov, the principal commander of rebel forces in Eastern Ukraine and a former Russian – not Ukrainian – military leader, has openly admitted that his support among ordinary Ukrainians in the East is exceptionally thin and he can’t win on the battlefield without the direct assistance of Russian troops.  He’s actually threatened Putin with insurrectionist activity inside Russia if such support isn’t forthcoming.  So it’s hardly surprising to see Putin preparing such an attack, and sending in Russians to take over the leadership of the Ukrainian rebel forces lest the entire movement simply collapse.

Putin smiled as Ukrainian rebels shot down even more planes with Russian missiles, including in the area where MH17 went down, and Russia began massing even more Russian troops at Ukraine’s border, sending even more weapons, including rocket launchers, to the rebel forces inside Ukraine, and even began firing its own artillery into Ukraine in naked acts of war.

And Putin wasn’t satisfied with conventional warfare.  In Kremenchuck and Lviv, Western areas outside the scope of rebel activity, terrorism acts began to unfold:  there were assassination attempts against the local mayors.  In the former case, the mayor was gunned down mafia-style and killed, while in the latter the mayor escaped harm after a rocket attack.  Pro-Russia forces are engaging, in other words, in the same kind of activity in Ukraine that Putin condemns as “bandit” activity in places like Chechnya and Dagestan.

Nor was Russia satisfied merely with destabilizing Ukraine.  Dmitri Rogozin, Luca Brasi to Putin’s Don Corleone, appeared in the separatist region of Transnistria in Moldova and was photographed with the local kingpin wearing shirts with the Russian flag.

Putin knows these acts are evil and catastrophically dangerous to his nation’s future, that’s why he lies about them so extensively to his fellow citizens.  The Economist magazine put it well: under Vladimir Putin, Russia has become again a place where “truth and falsehood are no longer distinct and facts are put into the service of the government.”  The magazine warns: “Putin has set himself up as a patriot, but he is a threat.”

Perhaps ashamed of his actions in Ukraine and very nervous, Putin’s central policy there has been “plausible deniability,” which means hiding Russian military action by any and all means possible.  This fundamentally dishonorable, dishonest use of Russian officers, who must go about the streets of Ukraine wearing masks, must have a highly toxic, corrosive effect on morale.

And Putin isn’t lying only to his own people, of course.  In the wake of MH17, hoping to ward off another round of devastating sanctions, he promised Western leaders he would do what he could to rein in the bloodthirsty maniacs who roam the streets of the Donetsk region seeking Russian annexation, but as with Adolf Hitler, his words mean nothing, only his actions.

A normal country would be abashed, at least a little, by stories of naked incinerated bodies falling out of the sky and crashing through the roofs of orphanages.  Has there ever been another airline disaster in which the victim’s credit cards were stolen and used?  Believe it or not, yes, and that was in Russia, too.  A normal country would worry, at least a little, about doing permanent irreversible damage to its reputation and credibility by continuing to engage in atrocities such as these.  But Putin’s Russia is not a normal country.

Remember the heady days when Russia was strutting about the world stage, posting 6-8% annual GDP growth, and Putin’s apologists were hailing him as an economic genius?  Now, Russia is hailing 0.1% growth because at least it means Russia isn’t in a recession (yet).   Russia’s central bank just announced a major hike in interest rates, the last thing in the world an intelligent person would do when standing on the precipice of a recession.  But the Kremlin is so afraid of losing control of prices that it feels it has no other choice.  These are the horrors of neo-Soviet stagflation.

Pouring salt in Putin’s wounds, The Hague’s arbitration court found that the Kremlin had stolen billions from the investors of Mikhail Khodorkovsky and ordered it to reimburse them to the whopping tune of $50 billion.  Simultaneously, the Red Cross laid the groundwork for Russia to be accused of international war crimes in the downing of the MH17.  For the first time in his presidency, everywhere Putin was facing setbacks and losses.  Yet he refused to even slow down, much less reverse course.

Another thing a competent ruler of a country on the brink of recession likely would not do is launch open war against one of the nation’s major employers, but that’s precisely what Putin did against McDonald’s, which employs tens of thousands and generates hundreds of millions in tax revenues.  It was almost as if Putin was on the side of the U.S. and EU, which are daily tightening the screws of economic sanctions and looking to choke off all foreign investment in Russia.  Such bizarre, self-destructive acts were routine in the USSR, and the world thought it had seen the back of them.  Not so.

One Russian expat in Silicon Valley sums it up aptly: “To understand Russia’s lightening fast descent into the abyss, one has to understand a simple truth:  Russia was and is a failed state.”  Only those who have not actually seen Russia up close, and the Kremlin’s liars, can suggest anything to the contrary.

Another Russian, who spent time interpreting for Putin, is even more dramatically blunt:  “He knows he has failed to rule Russia in anything else but a feudal way, and the moment his grip falters it will all come crashing down, and he will go to jail, and Moscow will burn like Kiev.”  As a result, Putin is extremely paranoid, having all his food for foreign trips (which he makes several times each month) flown in from Moscow and vetted by food-tasters overseen by the KGB.  He will literally not even touch foreign food abroad.

Putin has led his nation down a dead-end street.  When you listen to Strelkov these days, you hear bitter, poisonous attacks on Putin for failing to intervene sooner and stronger and letting many Ukrainian rebels perish.  Eastern Ukraine is poised to become Putin’s Bay of Pigs, or, in the alternative, a major hot war that Russia stands every chance of losing (the U.S. ambassador to Ukraine just announced that the U.S. will start supplying military support to Kiev).  As such, it could become Putin’s Vietnam.

Follow Kim Zigfeld on Twitter @larussophobe.