I could spray foam into the gaps above the brick and below the floor boards to seal it up Perfect. You're air sealing, not insulating. Never put fibrous insulation behind those solid brick walls or in the rim joist area of any house. It will get wet, promote mould growth and not insulate or air seal. Here is a link that might be useful: Insulating Old Brick Buildings This post was edited by worthy on Sun, Mar 3, 13 at 9:54

The vapor barrier in a heating zone goes as far in against the heated area as you can get it. The back of the finished wall surface is a good spot. The tar paper against the brick was intended to serve as a final drainage plane for the masonry wall. Masonry is waterproof only in the sense it is not harmed by water. It will stop the free flow most of the time, but still can wick moisture through.

Oh, and I keep hearing about the "vapor barrier" which I guess is Tyvek, but, I'm sorry, I'm just too dumb to get what all this means when dealing with a cinderblock house. A friend told me that he completely reframed his basement with metal studs, installed insulated and then put up new drywall. Sounds too expensive since our house needs so much more to be repaired. We are doing this ourselves. I don't know what the code is on this.... Uggh.

Thanks to bill, live wire oak and Springtimehomes. Things moved very quickly. Instead of insulation company, sheetrock company insulated, Cost was the same but sheetrockers did a lot of removing of old plaster, rock, wood and old insulation. Used batts, R-13 in walls and R-30 in ceiling, We do have knob and tube. I brought baffles and they were installed in some places. I think I should have had the insulation company insulate and then had the sheetrockers come in but done is done. House has been in reno mode for a full year and I am done. We will blow the remainder of the attic after we have some of the K & T replaced. Many thanks for your inputs.