Do we need fluoride in our water and toothpaste?

Yes, definitely. Yes, water fluoridation has been one of the greatest advances in health care in the 20th century. It has been proven time and time again that Fluoride makes enamel stronger and reduces tooth decay and has no detrimental side effects. Fluoride occurs naturally in the earth and ground water all over the world, so humans and animals have been consuming it with no harmful side effects forever.
Fluoride for teeth- Dr. Beck already gave you a great answer regarding Fluoride in our water supply-simply the best way to strengthen teeth with Fluoride (systemically as they are forming). Fluoride in toothpaste is another but less effective method. Good oral hygiene and nutritious foods would make these methods almost unnecessary but very few of us do what we should in this regard.
Both are recommended. The current philosophy in dentistry is that Fluoride in the water hardens teeth against cavities by being incorporated in the developing teeth when we are young and also we get some absorption once the tooth has erupted in the mouth. The Fluoride in toothpaste is absorbed on the surface of the tooth and hardens it as well.
Absolutely. In europe they used to ignore this problem. Too many people had dental disease. One of the things we should like about the us. Unless you want your dentist to become too rich.