In demographic, political, military, and economic terms, Germany is the most powerful country in Europe and plays a crucial role within the European Community (EC). Germany has also become increasingly assertive in international diplomacy. Will Germany now seek to dominate Europe once more? Will Germans build a Fourth Reigch? The answer, in our view, is no! Germany's gross national product is larger than France's, Britain's, or Italy's within the EC, but any of these two states combined outweigh Germany. The German economy moreover faces numerous problems. Germany has shouldered a heavy burden in rebuilding East Germany, ruined by more than forty years of Communist misgovernment. Germany provides massive aid for Russia and other East-Central European countries. Germany, although superb in selling manufactured goods to the rest of the world, needs to progress in a variety of new high-tech industries. Above all, Germany's domestic expenditure has risen as the German welfare state has expanded--German wages and taxes are among the highest in Europe. German unification has also saddled Germany with difficult new political problems, as the new Germany must cope with both disappointment and xenophobia. Nevertheless, both nazism and communism are too discredited to make a comeback. As regards U.S.-German relations, although there are numerous disagreements, none is insuperable. Both Germany and the United States are democracies and have established a "special relationship" tied by economic and political self-interest. The United States had the least to fear from German unification among the North Atlantic Treaty Organization states and was--of all states--the most supportive. By the same token, Germany understands the value of the EC-U.S. partnership. The world has indeed been fortunate.