By Mick Krever, CNN

Far from the moderating role Russian President Putin says he is seeking, the U.S. Ambassador to Ukraine on Wednesday said that Russia is “escalating the military confrontation.”

“The fact is, we have worked through every diplomatic channel available to us. We have exercised economic leverage,” Ambassador Geoffrey Pyatt said.

“But so far, and sadly – although there have been occasional positive statement from Moscow – the actions are going in the wrong direction at this point. The actions, incredibly, are heading towards escalation of the crisis.”

The Netherlands on Wednesday paid solemn respects to the first of the victims of Malaysian Airlines Flight 17 to be flown to Holland.

In Ukraine, where so many of the victims remain – some not even yet found – the conflict rages on. Two Ukrainian military jets were shot down in areas controlled by pro-Russian rebels, the Ukrainian government says.

“It’s simply incredible, but it’s an established fact that even after the shootdown of the Malaysian Airlines flight you still have heavy weapons, tanks, rocket systems moving across the border from Russia, enflaming the conflict, escalating the military confrontation, at a time when President Poroshenko has made very clear his desire to find a political solution,” Ambassador Pyatt said.

Indeed, he said, “most of the leaders of the Donetsk republic today are Russian citizens; they’re Russian passport holders. Several of them are Russian intelligence operatives.”

And Russia’s influence is not only being felt by its physical presence, Pyatt told Amanpour.

“One of the most striking characteristics of this crisis to me has been how the Kremlin has weaponized information. How the Kremlin has used this information warfare to sow fear.”

As European leaders in Brussels discuss how far they are willing to go in tightening the economic screw on Russia, Pyatt vowed that the United States would make sure Moscow is punished.

“We certainly, the United States, have made clear that if this direction does not change, we are prepared to further raise the costs that Russia and the Kremlin pays for its aggression.”

Michael McFaul, who very recently stepped down as the American envoy to Moscow, has been weighing in on the conflict in a way he could not when he was held to the diplomatic protocol befitting an ambassador.

“West has to stop trying to change Putin's mind, and focus more on helping Ukraine succeed, including on the battlefield,” McFaul tweeted. “If Putin can arm rebels, why can't we arm Ukraine?”

“It’s great that Mike continues to focus on this set of issues,” Pyatt responded. “Our view at this point is that there is no real military solution to this crisis. It has to be solved through political means.”

“Ukraine cannot change its geography. It needs to find a modus vivendi with Russia. We’re going to continue to provide military support to Ukraine with a view to helping this country to defend itself.”

“But it can’t defeat Russia, and frankly it won’t be able to achieve the political solution that President Poroshenko seeks as long as the Russian military is maintaining training camps in Rostov and sending tanks and rocket launchers across the border every night.”