It is pretty clear that Russia and Georgia are at war (see excellent background article here). It is not like there were no warning signs that Russia did not enjoy having its power challenged, as happened with the independence of Kosovo where the UN ignored Russia's opposition and went ahead with support for the new republic over its objections. Then, a few weeks ago, I posted on the fact that it seemed that Russia was engaging in a new Cold War in an attempt to reclaim some global military leadership. The invasion of parts of Georgia in support of independent movements in Southern Ossetia and Abkhazia should be read in that context.

As usual, I find Michael Mann's conceptualization of different forms of power useful to understand what is going on here. As Jonathan Steele puts it in the Guardian, this is not just an economic war, a "pipeline war", but a war of political influence. Political power, more than economic, might be at work here:

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