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 merely waiting until the economic readjustment, which is now taking place after the war, is completed. America must tackle the situation in a more fundamental manner. America must reorganize her industrial housing industry. This means that first there must be a thorough understanding of conditions in the housing industry, and of its organization and methods of operation. This knowledge will form a basis for reorganization.

The key to the puzzle of the housing industry lies in understanding its place in the economic history of the American nation. Housing has always been intimately related to the real estate exploitation of a continent. This exploitation has made housing a small-scale business, individualistic, very loosely organized and highly speculative. Its roots reach down to pioneer economics, back to the days when each householder built his home in a clearing, cutting down the trees of the forest for building materials. As towns and cities developed, the primitive method of the frontier soon gave place to a system of division of functions and of responsibilities. In this more specialized system the local real estate sub-divider, the small capitalist investor and speculator, and the local builder, banker and lawyer, each had a part. The same system prevails to-day in most parts of the United States with but slight modification. Its method of operation is common knowledge and needs no description here. In fact, people are so accustomed to it that they overlook its defects.

In the latter part of the nineteenth century efforts were made to give to this small-scale local system the benefit of large-scale finance. Capitalists organized the large mortgage companies, and the huge insurance companies like the Metropolitan Life Insurance Company and the Prudential Life, which invested a part of their funds in mortgages. The workingman himself developed the extensive system of building loan societies, for the sole purpose of financing his own home. In this connection one may also mention the growth of large industries in the manufacture of building materials.

The introduction of these large-scale factors, however, although they were steps in the right direction, could not correct the fundamental defects of the system. The large mortgage companies found it more profitable to make loans on large