The new missile row masks a bigger issue for former eastern bloc countries - Russia's control of their fuel supply, writes Daniel McLaughlinin Budapest
Speaking to foreign correspondents in Russia last week, president Vladimir Putin told a revealing joke about former East German leader Erich Honecker.
"How can you tell which of the telephones on Honecker's desk is the direct line to Moscow?" he asked them. "It's the one with a receiver and no mouthpiece." The line, dredged up from his years as a KGB agent in Dresden, underscored how times have changed: Germany is long unified, Honecker is long dead, and the former eastern bloc countries (in central and eastern Europe) long ago stopped taking orders from the Kremlin.
Now Russia is left to growl as the European Union and Nato fly their flags over the region, and Pentagon generals pick prime spots to place their radar, missiles and troops. The prospect of a long-range US radar in the Czech Republic, an interceptor missile silo in Poland and military bases in Romania and Bulgaria prompted Putin to compare central and eastern Europe to a "powder keg" that he advised Washington not to "stuff with weapons" unless it wanted to provoke a new arms race or even a second cold war.
Poland's president Lech Kaczynski compared Putin's bellicose rhetoric to that of Soviet leader Nikita Khrushchev, who took the world towards the brink of nuclear war during the 1962 Cuban Missile Crisis.
The Kremlin's ire also did little to soothe the millions of Poles and Czechs whom surveys suggest strongly oppose plans to host the US radar and missile facilities.
"Of course Russia will react to this, just as America did when they learned of Russian missiles in Cuba," said Prague accountant Jan Malina (48), during US President George's Bush's visit to the Czech capital this week.
But in places such as Prague, Budapest and the Baltic states, which bitterly remember bloody invasion by Soviet troops, few people now really fear an attack by Russian forces, despite Putin's threat to train missiles on any US military installations in eastern and central Europe. "I don't feel scared, but (a cold war) could happen again," said Czech film producer Richard Nimec (35).
"What drives me crazy is the fact that (politicians) present it to us as if there were no other possibilities but these two: either the US radar or the Russian tanks. I do not think this is true." The arc of Nato now stretches from the Baltic to the Black Sea, and Moscow, for all its boasting of a new generation of rockets that can pierce any missile shield, is hardly likely to attack a member of Nato and trigger the bloc's mutual defence clause - which holds that an attack on one is considered an attack against all.
With the Soviet collapse and the evisceration of the Russian military, the Kremlin had to find new weapons of influence in the world, and it has taken more than a decade to do so. During the 1990s under Boris Yeltsin, Russia was for the most part a big and bumbling friend to the West, forever stumbling over to ask for a loan and advice on how to liberalise the economy, privatise property and conduct democratic elections.
Putin, who took power in 2000, ended all that.
He restored a sense of order at the top, even if corruption and incompetence are still rife in most of Russian life; he ignored complaints about dwindling free media and civil society; and he did not ask foreigners for advice or for money - instead, he repaid their loans and told them where they were going wrong.
Putin is healthy and sober, but his bullishness has been sustained by something else that Yeltsin lacked - soaring world prices for oil and gas, the lifeblood of the West.
And now, in eastern and central European capitals that once feared Moscow's political and military might, people fear the squeeze from the Kremlin's bulging economic muscle.
"Now the Russians have got oil money," said Alexander Rahr, of the German Council on Foreign Relations. "They have their national pride, and don't want to be seen as a junior partner of the West. Remember they were humiliated back in the 1990s." For the EU, such a Russia makes a tricky trading partner, not least because the bloc gets a third of its oil and half its gas from fields and through pipelines largely controlled by the Kremlin.
For EU members which were in the old communist bloc, energy dependence on Moscow is even more acute because almost all their oil and gas arrives through Soviet-era infrastructure that is plumbed into Russia.
The Kremlin's heavy hand on the fuel tap, rather than a hail of ballistic missiles, is what most people in eastern and central Europe and their leaders now worry about, particularly given Russia's recent record in energy dealings with its neighbours.
In winter 2006, Moscow cut gas to Ukraine, Georgia and Moldova, all ex-Soviet states that seek ultimate membership of the EU and Nato. In turning off the tap to Ukraine, gas supplies all the way west to Italy were affected, sending shivers through Europe.
Russia blames its neighbours for not paying the market price for fuel or for stealing it from pipelines, but few analysts believe Moscow's energy policy is not swayed by politics.
During a row over the rights of ethnic Russians in Latvia, for example, Moscow suddenly announced a lack of capacity in its pipeline to the country's main oil terminal, and shut it down; in neighbouring Lithuania, the sale of a big refinery to a Polish rather than a Kremlin-backed firm last year was followed by a Russian announcement that the pipeline taking oil to the facility was damaged and would have to close. It is still not working.
Just last month, Moscow cut deliveries of fuel to Estonia amid a row over the Baltic state's decision to move a Soviet war memorial.
Russia also plans to build a pipeline under the Baltic Sea that would allow it to deliver gas to Germany and valuable markets further west while bypassing troublesome neighbours such as Poland, Latvia, Lithuania and Estonia, where people fear their heat and light will fluctuate with the political mood of the Kremlin.
Polish president Lech Kaczynski even said this week that Nato should look at how to protect members' pipelines and refineries, given their reliance on Russian energy imports.
"If to the east we had a partner which would be closer to our values, and a partner which would be capable of a broader co- operation, there would be no problem for Poland," he said.
Taking over a chaotic, demoralised country, Putin has played a wily game with the cards in his hand. He opposed the US-led invasion in Iraq but Russia profited from the subsequent surge in oil prices; he has warned Iran not to pursue nuclear weapons while Russian engineers build an atomic power plant for Tehran; and Moscow has used the implied threat of its UN Security Council veto on a range of issues, most recently that of Kosovo's bid for independence, to win concessions on other matters from Washington and Brussels.
Russia has also become adept at using economic leverage for political gain, and vice versa: Russian firms have established disproportionately strong positions in Serbia and Montenegro, two political allies, while major Western energy companies urged their governments last week not to allow political quarrels to hinder big gas deals with Russia.
Moscow's current confidence was encapsulated in the response of Sergei Storchak, a deputy finance minister, to departing British premier Tony Blair's suggestion at the G8 summit in Germany that major firms would shun Russia unless it cleaned up its act. "I doubt business will react to the rather emotional words of, after all, an ex-prime minister," he said.
Energy-rich Russia knows that its main critics now need it as much as it needs them - and that its abrasive former allies in eastern and central Europe need it more than most, given their almost total dependence on Moscow's oil and gas.
"Kosovo is part of a host of issues - energy security, missile defence, human rights - that Putin has used to wreak havoc, to divide the EU from within and split the EU and US," said Julianne Smith at the Center for Strategic and International Studies in Washington.
Missiles may be making headlines, but the vision of a new kind of cold war now keeps East European leaders awake at night. The kind in which the Kremlin reaches for the gas tap rather than the nuclear button - the kind of cold war that Russia is already winning.