Russia’s annexation of Crimea is reprehensible and unjustifiable. Moscow’s actions make a mockery of international norms and understandably are a grave concern to its neighbors and the West. But, odious as the Russian actions are, in the end Russia is the loser, in the short and long term.

At the outset of the Ukrainian crisis in November 2013, Russia had two main goals: 1) prevent Ukraine from signing an agreement with the European Union and 2) make Ukraine part of the Moscow-led Eurasian Customs Union. It failed on both counts. Kiev signed a modified version of the association agreement with the EU in March and the Eurasian Union will not be worth the paper it is written on without Ukraine, the crown jewel, as a member.

Furthermore, as part of its first goal, Russia hoped to prevent Ukraine from tilting politically, culturally, and socially toward the West. Instead, Russia’s invasion of Crimea created an opening for Western influence and assistance in Ukraine and essentially thrust Ukraine into the West’s now-eager arms.

As part of its second goal, Russia had hoped to remain an influential player in domestic Ukrainian affairs. Now, however, with the removal of a significant block of pro-Russian voters in Crimea, Russia’s influence in Ukraine has considerably declined and Ukraine’s parliament is likely to be less inclined toward Russia than it would have been if Crimea had remained part of the country.

So Russia’s geostrategic goals were not realized. In addition, it has been left holding the bill for Crimea and also facing international censure and penalty. This is hardly a winning combination. Putin has shown he is no grand chessmaster; he has set back his strategic goals with swift but ill-considered military moves that, at most, will give him temporary bump in Russian public-opinion polls.

Much of the breathless punditry in the United States in recent weeks has come from two camps: internationalist idealists who are disappointed that engagement with Russia (the vaunted “reset”) failed and who are furious that Putin defied international norms; and hawks who warn that Putin is threatening American power and the global security system, and who say that a strong Western response is needed.

But those who imagined a happy liberal-democratic outcome for Russia, less than a generation after the collapse of the Soviet Union, had overly high expectations and seriously misread the country’s history. Russia has been held to an impossibly high standard by many in the West, who consider it to be a flawed but essentially European country.

And those who continue to see Russia as an evil empire, plotting to expand its territory and foil the West at every opportunity, are also wrong. Certainly Russia seeks to maximize and promote its interests, as any country does, but Russia is not the most significant threat or adversary to the United States, or even to NATO and Europe, as President Obama has made clear.

The truth is that Russia is a middling power with a faltering economy and serious demographic problems trying desperately to stay relevant both on the world stage and in its own neighborhood. President Obama was right when he called Russia a “regional power that is threatening some of its immediate neighbors—not out of strength, but out of weakness.” In addition, Putin is vulnerable at home and is seeking to shore up his own political standing.

It is unlikely that Putin would risk a larger conflagration by menacing NATO allies such the Baltic countries. His targets—Crimea and South Ossetia—have been carefully chosen to minimize the risk of military confrontation with NATO. But concerns about a military incursion into Eastern Ukraine—though a perilous move for Putin—must be taken seriously.

Putin has been clear about Moscow’s priorities, which include preventing NATO expansion and maintaining close Russian ties with the former Soviet Republics. Russia’s reactions in Ukraine and Georgia were triggered by what it perceived to be threats to those vital interests.

Russia’s actions in Georgia and Ukraine are deplorable, but they do not significantly alter the global balance of power. It is important for the United States and its allies to express strong disapproval and to punish Russia and deter it from further action—but the West should not overreact or create new flashpoints. Treating Russia as our most dangerous adversary plays into Putin’s hands and confers on him the international distinction that he covets. It also strengthens his hand at home.

The fact is, the United States benefits from working with Russia on issues of mutual interest, including counterterrorism, nonproliferation, space exploration, Arctic collaboration and global warming. The United States will continue to disagree and even oppose Russia on other important issues, including human and civil rights.

But this push and pull and give and take does not necessarily equal a new Cold War. Many in Washington seem nostalgic for the comforting simplicity of the Cold War, with its clear dividing line and known enemy. But that outdated paradigm does not reflect today’s reality. Russia is not our friend, but it is not really our enemy.

Balance is key—we must view Russia as it is, weak yet dangerous—and the West as it is, strong yet constrained. Russia has Crimea, but it ultimately lost this round. Keeping Russia’s so-called victory in perspective will help calibrate our own response.

Anya Schmemann is an Assistant Dean at American University’s School of International Service and a non-resident Senior Fellow at the Center for the National Interest.