How would Americans feel if a Russian "missile defence shield" was erected in Mexico or, more in keeping with Washington's most recent bout of paranoia, in Venezuela? You don't have to guess the answer.

The United States is a country with a well-developed, if contested, view of its geopolitical backyard, and a nation with reasons to fear for its security. As a result, it sometimes - how best to put this? - fails to see itself as others see it. Anyone who remembers Reagan sounding the alarm because Nicaragua's rag-tag Sandinistas were a few hundred miles from the Texas border will know what I mean.

Besides, as Russia might say, putting memories of the Cuban crisis gently to one side, what business is it of the US where we put our purely-defensive peace-loving installations? We, too, must guard against those rogue states of which we have heard so much. But North Korea and Iran are in the other direction, you say?

At this point a Russian leader - let's call him Vladimir - might pause. True, he would allow, it doesn't seem logical to protect Moscow with an anti-ballistic system in Mexico City. But explain, please: if the crazed North Koreans were to launch at our friends in the US, wouldn't they launch across the Pacific, general direction Hollywood?

Why, then, the Russians might add, do our American partners in free enterprise insist on placing their defensive shield in Poland and the Czech Republic, by sheer coincidence on our doorstep? Why, for that matter, is early warning of the theoretical North Korean rocket to be given by a new radar at "RAF" Fylingdales, north Yorkshire? This is how you protect Burbank?

On the eve of the G8 summit in Germany, Russia's Vladimir Putin has been shooting off his mouth - but fortunately nothing else - on the topic of superpower politics. No war is in prospect, but suddenly it's chilly for June. Russia, flush with oil and gas money, newly status-conscious and driven by old fears (usually borne out) of encirclement and invasion, is asserting itself.

Putin regards US plans for defensive missiles in Poland and the Czech Republic as provocative. This sounds bizarre, but that is the way of nuclear poker. In the parlance of American football, the difference between offence and defence can seem slight when you are attempting to strike a balance of terror. Given that the US has already reneged on the 1972 Anti-Ballistic Missile Treaty, the new scheme seems - or can be presented as such - as an effort to neutralise Russia rather than the authentic rogues.

If that's the case, Putin said at the weekend, he might respond by selecting targets in Europe. The peace dividend of which we heard so much will become a dud cheque. He held back while Nato encroached on eastern Europe - his backyard - and merely sniped at George Bush's Iraq adventure. But Russia is no longer an economic basket case, and will no longer be insulted.

Students of recent history might at this point call to mind all the right-wing ideologues, with the Thatcher Foundation busy among them, who promised to liberate the post-Soviet empire after state communism was put to sleep. A good dose of free enterprise - unpleasant but, as always, necessary - and history would be at an end. No more Cold War. Liberal democracy all round. As the glib scribblers on economics liked to joke, no country in possession of a Big Mac franchise ever fired a shot at other Big Mac consumers.

Now people of the same stripe tell us that Putin is leading Russia towards fascism. They say he should be barred from the G8, and denied the chance to break solemn aid promises like a proper demo-crat. No-one has yet suggested that capitalism may possibly have failed to do the trick for the Russians. There is too much oil and gas at stake for that sort of talk.

You can build a case against Putin easily enough. He builds it himself as the outposts of free media disappear, one by one, from his country, as difficult journalists die mysteriously, as dissident political parties are extinguished, as sponsored skinhead thugs batter foreigners and gays, as the Kremlin relieves all but the most submissive oligarchs of power and as the old colonies of the USSR feel the displeasure of a former KGB man. All true.

But mention human rights to Putin, as an interviewer did at the weekend, and the dismissal might have been written by the western media. Guantanamo, he says; torture; illegal wars; the invisible global gulag of rendition flights. Bush has turned the moral high ground into a swamp. Little George and little Vladimir have much the same standing, at least in Russian eyes, but with one important difference. Putin is popular.

In fact, if you trust the polls, he is very popular indeed, certainly more highly-esteemed by his country than Bush is, or ever will be again. Wild talk of another superpower arms race is one thing, with Russia responding to the US shield by testing a new(ish) missile of its own, but the dictator, if dictator he is, appears to have his country's support. That complicates matters, not least for the G8. This populist may be representing genuine, widely-held Russian sentiments.

Not so long ago, before the blood and blunders of Iraq, some Americans were styling their country the last superpower. They took the "freedom agenda" to the old USSR's frontier states, from the Baltic to Georgia and Ukraine. It was embraced eagerly, but not uncritically. Russia, meanwhile, had its own upheavals and the dark, dirty secret of Chechnya with which to deal.

Then the oil and gas dollars began to flow. Moscow ceased to be the poor, baffled relation in international affairs. Putin, suddenly a nationalist and a devout Orthodox Christian - he, Bush, Blair, Sarkozy and Merkel have more in common than they will ever admit - decided to begin drawing his own lines in the sand. Somewhere in a Kremlin attic he discovered the ancestral sabre and found that it rattles still.

But is he serious? If you happen to be Estonian, victim of a recent, massive, Moscow-inspired cyber-assault, it's a daft question. If you happen to be Polish, or Ukrainian, or Georgian, you will dismiss the question, remember your history and wonder if Nato is really a panacea.

Cold Wars are bad for business, though. Despite the oil and gas, Russia's economy does not, as yet, impress many bankers in London, Paris or Frankfurt. The truly interesting thing about Putin is, perhaps, that he is electioneering, and speaking for domestic consumption, while being barred by Russia's constitution from standing again for the presidency.

"Supporters" hope he may yet remedy that situation. If that happens there will be real cause for concern. For now, Angela Merkel, hosting the G8 on Germany's behalf, will probably urge all the fractious boys, east and west, to calm down. America might think twice about the who-us? fiction that is the defensive missile shield. But Europe's leaders know that, behind all the bluster, pragmatism remains the ally of peace.

Putin has much of the gas and oil on which they depend. They have the money he needs. Why fuss over human rights, or thermo-nuclear posturing?