Ford joins GM in cutting domestic production

There are two main reasons why Ford and GM are not able to maintain production and therefore have launched large scale cuts in employment and production for the U.S. market: intransigence in the face of higher oil prices and high health care costs. While there may be other reasons, those are the two main reasons. On the first reason, both Ford and GM have continued to produce behemoths that get poor gas mileage, despite much higher gas prices. It is almost like they are still living in the 1990s with oil prices around $15 per gallon. In contrast, oil prices are now approaching $70 per gallon. Part of this is a failure of federal policy that could force higher fuel efficiency. A similar thing happened in the 1970s and the 1980s. The other factor is huge increases in the cost of health insurance. This would be mitigated with a national health insurance. American companies including GM have commented on how much they save in markets like Canada where there is national health insuraance. Furthermore, these systems are much more cost efficient than the American system of private health insurance, where administrative costs are many times higher than a publicly run system.