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b. to prevent the re-establishment of a German war potential, (1) by issuing instructions for the demolition of certain categories of

buildings and civil engineering works following upon decisions by

higher authority, and (2) by preventing the construction of such categories of buildings and

civil engineering works as would be capable of subsequent con

version to the development of a war potential. This system was designed not only as an immediate but also as a longrange program, for it soon became obvious that the extremely curtailed pro duction of building materials, due mainly to the lack of coal, would limit the immediate reconstruction of German cities. In addition, the control and licensing system provides for the equitable distribution of building materials among the four zones so that Germany can be reconstructed as a whole economic unit.

Prefabricated Housing

Investigations are also being conducted into the possibility of exporting prefabricated houses. The market for such a product will be unlimited in Europe and in Germany itself for many years to come. It is impossible to estimate at present the proportions which the export of prefabricated houses might reach, because the productive capacity for such houses and the materials involved are limited. In addition, it is still uncertain as to how many fabricating facilities will be left in Germany or how many can be converted to the production of prefabricated houses. It is hoped, however, that under terms of the Potsdam Agreement, which encourages the development of peaceful industries, the U. S. Zone, in cooperation with the rest of Germany, may be able to build what will be a new industry for Germany and may be able

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