The US has been taking steps to impose sanctions on Russia for its military intervention of Crimea, although Russian President Vladimir Putin said his actions were an effort to protect millions of ethnic Russians in the region.
"Some of the sanctions that are being discussed and the actions being taken, whether it's limitations on visas or on travel or on potentially freezing assets of specific individuals, frankly I don't believe are going to be any deterrent for Putin," Gates told host Chris Wallace on Fox News Sunday.
The former defense secretary called for actions that would ensure delivery of gas to Europe without Russian involvement, as Russia supplies a large chunk of Europe's energy.
"I think the Europeans, with our support, should now press ahead very aggressively with a southern pipeline that would get gas to Europe outside of Russian and Ukrainian territorial space," he said.
Gates also applauded actions taken in the Baltic States. "I worry a lot about the Baltics. I applaud the dispatch of additional fighter aircraft for the air patrols in the Baltic States Lithuania, Latvia, Estonia I think that's the right thing to do. We ought to be exploring doing more militarily with Poland," he said.
The former Pentagon chief believed this is part of Putin's strategy to recreate a Russian sphere of influence and a Russian block where Russia has economic, political and security relationships with these countries that make them all lean toward or do the bidding of Moscow.
"We saw it first in Georgia in 2008. We've seen it in him (Putin) breaking off the EU discussions with Armenia. We've seen him to the same thing in Belarus," he said.
"This is part of a longer term effort to stop the expansion of NATO, but more importantly, to bring the states of the former Soviet union back under the influence of Moscow. Frankly, I don't think he (Putin) will stop in Ukraine until there is a government in Ukraine, in Kiev, that is essentially pro-Russia," Gates said.
But he added that Putin does not want to recreate the Soviet union , precisely because the Russian leader does not want to have responsibility for economic basket cases like Ukraine is at the present time.
