It remains to be seen whether they manage to chew what they bite off.
I think economically Russia is in a stronger position that is commonly believed, and the EU is in trouble when you consider the EU's debt load and dependence on Russia gas. Russia can trade with much of the world outside the U.S. and immediate allies. They produce energy and food and they are allied with China--an alliance we have foolishly encouraged through our relentlessly aggressive posture.
The days of the EU states merrily pursuing dubiously optimistic energy policies are over and they're going to have to scramble and reorganize their economies. They are no longer the be-all-end-all of manufacturing and technological prowess. The oligarchs will just have to do without Italian fashion.
As to the battlefield situation, I think people misread the encirclment at Kiev. The best explanation I have read is that army was never large enough to take Kiev. Instead it was sent their to take Kiev in the event of a surrender and to pin down defenders if the war continued. It completed its task and redeployed to the Donbas to aid in the critical battle there.
The loss of the flaship is interesting. The Russians denied it was hit by a missile and the Pentagon refused to confirm, at least for a time. One suggestion for the Pentagon's behavior was that the ship was struck by a NATO missile crew from Ukrainian territory and neither the Pentagon nor the Russians wanted that to be the official reason, because if it were true...that would be bad.
Is it worth winning? For the Russians, probably. Their view is that NATO was encroaching in their sphere of influence, which was true. After all, we claim the entire New World as our sphere of influence and have never tolerated Russian or Chinese meddling in that area. At the end of the war they will have dismantled the Ukrainian army and put some space between Russia and NATO. Whatever is left of Ukraine after this war, Russia will not permit it to join NATO.
They have generated an enormous amount of animosity, but I think they decided they'd never be loved by the West and have given up. I'll bet Finland and Sweden joining NATO was unexpected, though.
From our perspective I'd be leery of letting those two states join since that's two more countries we're pledging to protect, but I think they will be admitted. We don't lose much in Ukraine ourselves in terms of national security. The purpose of Ukraine for the neocons who caused this situation was to menace Russia and tighten the noose on the global chessboard, and they'll just shrug their shoulders and move on to other adventures after this. Hopefully it will cost them a lot of prestige and we can replace them with less belicose thinkers.
As for Ukraine, they are screwed. Whatever promises we gave them that led to this situation should not have been trusted. Western leadership is deeply cynical and there was plenty of historical evidence of this if Ukraine cared to look. This region is going to become a festering source of trouble and misery for decades to come.
