On January 2, the U.S. Senate unanimously condemned the "Dima Yakovlev Law," a measure hastily adopted around Christmas time, that victimizes Russian orphans—and Russian democracy.

This piece of legislation bars the adoption of Russian children by U.S. citizens. It is namedafter Dima Yakovlev, an adopted child from Russia, who in 2008 was abandoned by his father in a sweltering SUV and died. A tragic case, to be sure. But the Duma's aim, initiated by the Office of the President of Russia, was not to protect innocents, but to retaliate against Congress for passing the Magnitsky Law.

Sergey Magnitsky was a whistle blower and an accountant/lawyer for the Hermitage Fund (the largest private equity fund in Russia) and its U.S.-born CEO Bill Browder. Magnitsky died in 2009 in Moscow's infamous Butyrka prison after he exposed alleged fraud by law enforcement officials that had cost the Russian treasury $230 million.

Bill Browder successfully lobbied Congress for a law that would punish Magnitsky's murderers and their bosses. By passing the law, Congress brought attention to the rot that has set in post-Soviet Russia. Indeed, U.S. lawmakers were doing the job of Russian lawmakers. If Russian law enforcement had punished Magnitsky's killers instead of promoting them, the law would never have passed in the first place.

The Russian government, however, forgot about the popular wisdom: "When in a hole, stop digging." The retaliatory Dima Yakovlev law is, in fact, a serious self-inflicted PR wound. It goes after the wrong targets. Not only is it plain mean—it also undermines Russian national interests and those of the United States. It cuts Moscow's proverbial nose to spite its face.

The law bans the successful and humane practice of U.S. adoption of Russian orphans, many of whom are disabled. By taking effect immediately, it fell with particular cruelty on four dozen kids who were already in the process of adoption. They, too, are barred from going to their prospective adoptive parents in the United States.

Moscow's action inadvertently draws worldwide attention to the horrible plight of Russian orphans. According to UNICEF, over 600,000 children are kept in state institutions, while the Russian government "admits" that it is "only" 110,000. In a country which is the biggest producer of oil and gas in the world, up to one million kids live in the streets—a disgrace for a prospective OECD member.

The Dima Yakovlev law also bans U.S. or U.S.-funded non-profit organizations which are helping Russia to develop modern institutions. As National Interest editor Robert Merry wroteon these pages, it prevents Americans from working for them or leading them, and forbids Russian NGOs from accepting money from the United States—a clear attempt to punish those in the Russian opposition who have ties with America. The law also demands that all NGOs that accept money from any foreign source register as "foreign agents." A chilling measure indeed.

Many Russian leaders, including Prime Minister Dmitry Medvedev, Foreign Minister Sergey Lavrov and others opposed the measure; the opposition media calls it "cannibals' law" and "Herod's law."

Deputy Prime Minister Olga Golodets and Vladimir Lukin, the Human Rights Ombudsman who was the first post-Soviet Russian Ambassador to the United States, argued that it violates the Russian Constitution and the country's international treaty commitments, such as the International Convention on the Rights of Child, and is wide open to a Constitutional Court challenge. However, with Valery Zorkin chairing the Constitutional Court, chances of legal annulment of the "Dima law" are nil.

During Boris Yeltsin's 1993 crackdown against the communist- and nationalist-dominated Supreme Soviet, Zorkin sided with the Supreme Soviet. A certifiable anti-American, Zorkin washeavily influenced by pre-revolutionary statist Russian jurists. He believes that the state is always right and must be preserved at all costs. He denies the opposition any "extra-legal" right to protest—even when the State tramples the law.

50,000 Russian have been successfully adopted in the United States since 1991. I know people who raised their adoptive children from the former Soviet Union with great sacrifice and immense love, including paying for operations, such as cleft palate correction, which would otherwise condemn the children to life in orphanages. The deaths of these adoptees is significantly lower (19 cases altogether) than among kids adopted domestically by Russians (over 1200). In the United States, 500-700 children die yearly by the hands of their parents. In Russia, with half the population, up to 1,500-2,000 die this way annually.

The plight of the Russian kids who cannot be adopted is tragic. Even more so is the domestic crackdown that started in the beginning of last year and the deliberate hostility towards the United States and its policies.

Vladimir Putin publicly stated that "'reset' was not our term"—effectively distancing himself from the Obama-Medvedev policy, of which he approved and which Medvedev carried out with his boss's blessing. This statement by the Russian president effectively hammers in the last nail in "reset's" coffin.

The question is, now what?

It is time for the Obama Administration to wake up and smell the vodka. "Reset" is not working in the geopolitical or humanitarian sphere. Even business relations are affected, as Russia has now banned imports of $500 million of U.S. meat a year.

The reset failed to produce U.S.-Russian understandings about Syria and Iran. Moscow is effectively flying diplomatic cover for the Assad regime because the U.S. and Europe fail to effectively prevent radical Islamists from taking a lead among the resistance. Moscow scoffed repeatedly at the EU and U.S. sanctions against the Iran and repeatedly stated that it opposes further sanctions, let alone other, harsher actions that may be necessary.

The Kremlin is reviving the rail-based ICBM deployment—a direct throwback to the 1970s and 1980s Cold War posture—as Russian demands for effective limitations on missile defense or U.S. technology sharing fail to impress even Obama administration arms control doves.

Ukraine and Georgia are in the process of falling into the Russian sphere of influence. More pro-Russian leaders taking over in 2010 and 2012 respectively, with nary a squeak from Washington.

The Russian media and the Duma are in the throes of an unprecedented anti-American pitch, similar to what the country experienced under its communist rulers from Stalin to Andropov and Chernenko. Some Russian bloggers and even members of the Federal Council who support the "Dima Yakovlev law" insinuated that Americans adopt Russian children to sell their organs, or they prefer disabled children in order to get federal support for taking care of them.

One wonders if U.S.-Russian relations have passed a point of no return. Certainly we appear to be sliding toward a prolonged confrontation—something that, in the long term, is in neither country's interest.

Ariel Cohen, Ph.D., is Senior Research Fellow in Russian and Eurasian Studies and International Energy Policy at The Heritage Foundation.