system at the time of the currency reform." Individual income tax rates, in particular, fell dramatically. Previously the tax rate on any income over 6,000 Deutschmark had been 95 percent. After tax reform, this 95 percent rate applied only to annual incomes above 250,000 Deutschmark. For the West German with an annual income of about 2,400 Deutschmark in 1950, the marginal tax rate fell from 85 percent to 18 percent. The Allied dismantling of the West German coal and steel industries decided at the Potsdam Conference was virtually completed by 1950; equipment had then been removed from 706 manufacturing plants in the west and steel production capacity had been reduced by 6,700,000 tons. Although the industrially important Saarland with its rich coal fields was returned to West Germany in 1957, it remained economically integrated in a customs union with France until 1959 and France extracted coal from the area until 1981. West Germany proceeded quickly after 1948 to rebuild its capital stock and thus to increase its economic output at stunning rates. The very high capital investment rate thanks to low consumption and a very small need for replacement capital investments (due to the still small capital stock) drove this recovery during the 1950s. Living standards also rose steadily, with the purchasing power of wages increasing by 73% from 1950 to 1960. As noted by the British journalist Terence Prittie in the early Sixties: Productivity growth in West Germany enabled most workers to obtain significant improvements in their living standards and 'security of life.' David Eversley wrote, As there was no army before 1955 there was little war spending. Reparations In addition to the physical barriers that had to be overcome for the West German economic recovery, there were also intellectual challenges. The Allies confiscated intellectual property of great value, all German patents, at home and abroad and used them to strengthen their own industrial competitiveness by licensing them to Allied companies. Immediately after the German surrender and for the next two years, the U.S. pursued a vigorous program of looting technological and scientific expertise as well as all patents in Germany. John Gimbel's book "Science Technology and Reparations: Exploitation and Plunder in Postwar Germany" concludes the "intellectual reparations" taken by the U.S. and the UK amounted to close to $10 billion. During the more than two years that this policy was in place, new industrial research in Germany was