Lots and lots of mold
As can be seen in the before picture, there is lots of mold in this basement, it addition to being very wet. One thing to remember is that it takes time for mold to grow. If a material has never had mold before and the material is wet and the temperature is normal ranges, it will take 3-14 days for mold to start growing. This basement was obviously wet for a long period of time for this extensive amount of mold to grow.
The unfortunate thing is that in situations like this, everything needs to be removed. Once we have removed the drywall, paneling, insulation, carpeting etc., we will need to clean the structural wood that is going to remain. Once that is clean and we dry everything out, it is time to rebuild!