Condoleezza Rice Remembers German Reunification

This month, Germany is celebrating 20 years since the reunification of East and West Germany.

Unlike British and French leaders at the time, the American administration of President George H.W. Bush encouraged the reunification of East and West Germany two decades ago, even if it wasn't sure how the details would all work out, says former U.S. Secretary of State Condoleezza Rice.

In an interview with German news magazine Der Spiegel, Rice says there was only a short window of opportunity when "the Soviet Union had to be strong enough to sign away its powers and rights but not strong enough to stop it." As a result, when the opportunity presented itself and West German Chancellor Helmut Kohl went full speed ahead with plans for bringing together the two parts of the nation separated by the Cold War, the Bush administration supported his fast-track approach.

In fact, there was apparently only one moment of disconnect between the White House and the chancellor's office, when Kohl didn't consult with his American counterparts before he presented a list of 10 points to guide the reunification process. But that speed bump was soon left behind, and Kohl and his plans remained in good standing with Washington.

Read the full Spiegel article for more on Soviet leader Mikhail Gorbachev's surprising role, the Bush team's worries about Kohl's re-election chances, the centrality of NATO to American comfort about German reunification, and more.

Condoleezza Rice will speak about her life, work, and family in a special event at The Commonwealth Club in San Francisco on Monday, October 18.

Helicopter Ben: Printing Money

"Helicopter Ben is still throwing money out there," said conservative businessman and Forbes editor Steve Forbes in his August 7, 2008, speech to The Commonwealth Club.

Forbes was referring to Ben Bernanke, the chairman of the Federal Reserve and one of the two key figures in the government's response to the credit crisis and the please-don't-call-it-a-depression recession (the other figure is the Treasury secretary). Forbes (see video below) also said, "Ben Bernanke once wrote academic papers saying the way you deal with a crisis is you print more money, throw money at it. He even made the analogy that Milton Friedman did to throwing money out of helicopters, which is why his name inside the Fed is Helicopter Ben."

Forbes was speaking back in August, when the full extent of our economic troubles was not yet known. Now comes news that Bernanke announced plans for increasing Fed Treasury purchases and mortgage-backed-securities purchases to the tune of more than $1.2 trillion. The Fed basically makes its own money, so it's printing the money and pumping it into the economy to try to unfreeze credit markets and improve the health of the financial system (which Bernanke told "60 Minutes" this past Sunday was key to recovery this year).


Forbes isn't the only person who raises an eyebrow at efforts to vastly increase the money supply. The same concern is behind the growing criticisms from the governments of Germany (a country that has strong memories of the disaster wrought by runaway inflation during the Weimar Republic) and France.

Put simply, the fear is that printing lots of money right now might bring an earlier end to the recession, but it will be nearly impossible to shrink the supply at just the right amount at just the right time at just the right speed during the recovery to prevent runaway inflation.

Is it a case of the lesser of two evils? Can Bernanke -- an expert on the Great Depression -- successfully manage the transition to recovery? Will the $1.2 trillion be enough to make a difference? Leave a comment and join the discussion.