Wednesday, September 8, 2010

From the Annals of Backward Logic: The US Travel Association's New Fee

Get this: in order to entice, through advertising, more tourists to visit the United States, beginning today all foreigners traveling here not on a tourist visa will have to pay a $14 fee.... to support our travel advertising.

(Those who will be hit with the new fee include most European nationals, along with Japanese visitors, South Koreans, Australians, Kiwis and others--36 nations in total will be affected.  Ten dollars of the fee goes towards the advertising, and $4 to Homeland Security for processing passengers coming into the US.)

Um, dontcha think the visitors are going to notice that they're paying more than they used to and getting, well, nothing in return? Is this really a way to build bridges between our country and others?
In line at the airport; photo by David Morris

Let's be clear here: the problem is not the advertising. That plan is a good one and long overdue. Other western nations have been advertising for years, and their effective marketing strategies (along with the bad rep the US has for harassing visitors at its borders) has led to America losing a significant piece of the tourist pie over the years. According to USTIA stats, the US welcomed 2.4 million fewer visitors last year than it did in 2000. This drop came at a time when the weakness of the US dollar should have been a potent lure for visitors carrying the much-stronger Euro, Pound and Yen.

So the advertising in and of itself, isn't a bad idea. But it boggles my mind that no-one in charge sees the disconnect between taxing the very visitors we want to encourage.

They do note this problem overseas, of course. Bloomberg news quotes Steven Lott of the International Air Transport Association (a Canadian citizen) as calling the tax "counterintuitive", and noting that it will make the US seem less friendly, not more. He goes on to say, smartly I think, that "Ending long waiting lines and revising complicated entry procedures would lure more travelers than ads."

What this all boils down to is another example of how the United States won't learn the lesson that in order to make money, you sometimes have to spend some money. We, as citizens, should be footing the bill for this advertising campaign. It has the potential to create thousands of new jobs. By passing the cost off in this way, we undermine the effectiveness of what we're trying to do.

We're also likely going to make it more difficult for Americans to travel abroad. I have no doubt other nations will retaliate with their own extra fees, targeting US citizens. That's the pattern we saw when we allowed the visa fees for entering the US to balloon. This, in turn, will impact all of those companies in the business of sending Americans abroad.

It reminds me of all of the taxes various municipalities around the US are levying on tourists in an attempt to balance their shrinking budgets without raising taxes on their own constituents. These onerous fees discourage travel, which in turn mean that those who depend on the tourism industry to make a living (1 out of every 11 in the US, by some estimates) lose business, or sometimes even go out of business.

I've obviously oversimplified the argument here, but this passing of the buck is a problem. Just look at what the federal tax cuts have meant for this nation: more sales taxes in many states (which have the heaviest impact on low-income people) and a big loss in services. In Hawaii, to give one example, the school system had to cut 17 days out of its calendar because it couldn't afford to pay teachers for those days. This in a state that already ranked toward the bottom of the nation in its test scores. That's terrible news for the children, who won't be getting the education they deserve; but also for parents who will have to miss work to care for the kids or pay out of pocket for childcare. Likely, the expense of those 17 days for families will far surpass what they supposedly "saved" with federal income tax cuts.

I know that this blog has veered far beyond travel, but hey, its all related. We need to stop thinking short-term, start investing in our future (the only way out of this recession; on this I agree with Paul Krugman) and start taking travel seriously as an engine for creating jobs and economic stability.

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