The Russian government has announced a plan to freeze spending after Standard and Poor's downgraded the country's credit rating to its lowest in ten years.

Despite Russia's crumbling economy, Russian President Vladimir Putin appears to be doubling down on the military and Ukraine.

KT McFarland said on "Happening Now" today, "Putin needs an enemy right now. He needs his people to rally around him. He wants to stay in power. And so he's got an enemy. Who's the enemy? The West, the United States, Ukraine."

"He's got to have an enemy to focus the attention of the Russian people away from their dire economy and towards an external enemy."

McFarland said that Putin's popularity rating at this time last year was below 50 percent, but after the Ukraine crisis began, it is now up to 80 or 90 percent.

"I think ultimately he's going to run into big trouble, because the Russian economy is not going to get any better. The Russian economy needs high oil and natural gas prices ... If those prices are low, Russia's income stream has run into major trouble."

She asserted that to stay in power, Putin must ramp up the anti-American rhetoric and challenges to the West.

"Putin's come up with this thing that's called a 'phony war.' And what he does is he sends Russian special forces into the borderland countries. They hook up with ethnic Russian population and they cause trouble."

"I think that's what Putin's going to continue to do ... and the West is going to have a very difficult time responding."

Watch the clip above.