Transcript

Host: Mark Murphy, TravelTube.com

Hey folks, it's Mark Murphy with TravelTube.com, and I think we have a bit of a barn burner here today. I'm going to cover a few things in rapid fire. I'm going to respond to some of the comments from last week's podcast that got posted in several forums on Facebook. I'm very happy that they posted them—always happy to have a dialogue—but it's obvious to me that the people who commented and were the most vocal about their opinions never actually listened to the podcast.

Because if they did, they would realize that they were out in left field and we were running the bases. It was a story about media misinformation and trying to blame the downturn in travel from places like Canada specifically on the current administration and tariffs. Now, tariffs do affect things, but not to the extent that these travel advisors are talking about.

Response to Facebook Comments

I'm going to show stark differences in the cost to travel to the US versus some of the destinations that people are saying they're going to instead of the US—like Portugal and Mexico, for instance. We're going to cover that. London's going to be unveiling a new tourist attraction, and I'll get into that and why it's always important to evolve. And then if you're a larger traveler—like you weigh 400 pounds—it's going to cost you more on Southwest.

So let's get into it. In response to my podcast that I shared in this group, I got a lot of comments. There were people posting a bunch of stuff, and then the moderator did a nice job. She said, "Hey, I want to know if you're outside the US, are you booking less travel to the US? If so, what are you booking and why are your travelers booking elsewhere?"

There's this thing called confirmation bias, and there's a lot of that going on here. But just to give you an example: "Clients are nervous across the border. They're afraid of being detained. Long-stay guests are going to Portugal, Spain, and Mexico."

Okay, cool. Great destinations. I've been to all of them, so I can't say anything bad about them. And given the economics, I get it.

But I've got to address this: "Clients are very nervous to cross the border." Why would clients be nervous to cross the border? Are your clients convicted criminals that are not allowed to enter the United States? Are they wanted by Interpol? Are they wanted for crimes in the US? Are they trying to sneak across the border, as opposed to going through the normal customs and border protection processes?

It's really easy. You come down from Canada, you can come through and be done before you even get to the US. You don't have to worry about landing and worrying, "Am I going to be detained?" Because that makes no sense. You're worried about being detained? You're a tourist coming to a destination. Why would you be detained, and why would you be concerned?

Well, for the folks who didn't actually listen to the podcast last week, guess what it is? It's because of propaganda. The CBC does 70 to 80% negative news on the US and the current administration in particular.

Economic Factors vs Political Concerns

Let me address some specific comments I saw:

"Bookings are down. My travel to the US is almost zero right now. Going to Europe and Caribbean instead."

Could it have anything to do with money? Let's see. They do escorted cruises, and this doesn't make much sense: "My next is Caribbean this winter. Sadly, most Canadians are staying home." So now they're not going on Caribbean cruises. Why? Because you have to fly into Fort Lauderdale Airport or Miami to get on a cruise, or go down to Galveston or fly to New Orleans and go out of there. It's a Caribbean cruise, not a US cruise.

"I have people say that they won't go until Trump is gone."

I thought Trudeau was problematic. Did I not travel to Canada and start a company up there because your prime minister is a problem? No, I didn't. That's really interesting. I think this is good: "The movement in Canada is to buy Canadian, and if you can avoid buying American, sure." If I can buy US-made products, I do the same. I have no problem with that. That is nationalism, and nationalism is not a bad word.

"I live in Florida half the year and many Canadians are selling their homes."

I totally get it. Let me tell you why they're probably selling their homes there. They could be saying it's because of Trump, but did Trump cause the hurricanes that raised their wind insurance? Remember, he wasn't in office. So hard to blame him for it, but I'm sure you could find a way.

Let's see—my wind insurance went from $5,000 for wind insurance to $17,000. Now it's down to $14,000. My combined property tax—and I'm homesteaded, meaning they can only raise my taxes a small percentage every year, not the same for a second home owner out of Canada. You're going up with whatever the change is. It's not fixed. I think we're fixed at a maximum of 3%. You come in and you're not homesteaded, you're going to get hit every year, especially as the home values go up.

What's happened to home values in Florida? They've gone way up. They've doubled in five years. So you're sitting on a home that maybe you bought in 2014—it might be up 300%—and all of a sudden you're getting hit with these taxes, you're getting hit with the insurance costs. My insurance and tax costs, and I'm at a low tax rate for my house—I pay $60,000 a year US. How much would I need if it was Canadian? I would need about $85,000 Canadian to cover that.

Could it have anything to do with that? While at the same time, your exchange rate went from almost parity—like $1.03 the year before Trudeau took over—then it went to $1.07, $1.08, $1.10. Now it's $1.40 Canadian to buy one US dollar. Could that have something to do with it?

Cost Comparisons: Mexico vs Portugal vs US

Let me show you some economics. How much does it cost to stay in Mexico for a month? $800 to over $2,000 depending on your travel style and location, with budget options in less expensive cities costing around $800 to $1,200. If you've got $2,000 or more, you're a premium traveler. So I can understand why people in Canada would be like, "Maybe I'll go to Mexico."

Now let's see how that compares to Portugal. If you're Canadian, it's almost certainly cheaper to spend a month in Portugal than in the USA due to significantly lower costs for basically everything other than the airfare. And sometimes it's cheaper to fly to Portugal than it is to the US. The rent for the place you're going to stay—if you're staying like in a one-month apartment or house rental—is about 70% cheaper than the US today.

So I get it. Your exchange rate went from $1.03 in 2014 to $1.40 to buy a US dollar. That's a 40% increase in cost, just everything being the same. But everything's not the same, folks. What's happened in the US? Demand for travel's gone through the roof, prices have gone through the roof.

For Fort Lauderdale, the baseline starts—if you want to come to Fort Lauderdale for a month—$5,000 for a single traveler, $10,000 to $12,000 if you're traveling as a couple. If you're traveling as a family, $20,000 plus for a month in Fort Lauderdale.

I understand you're paying 13% in sales tax if you live in Toronto, for instance. You're giving up a third of your income to all that "free" healthcare you guys talk about so much. Your wages have been stagnant according to your own government. The GDP per capita of Canada compared to the US has diverged dramatically—ours going up, yours now going down. Bad sign.

The Canada-USA Prosperity Gap

Here's the big reveal, folks: the Canada-USA prosperity gap. Look at where we were in the '70s all the way up to 1980. Then we hit 1980—we had President Ronald Reagan. We went from being almost on par with you in 1981, right around $30,000 per capita GDP per capita.

Then, because of policies that actually worked, around 1988 we hit $40,000, just a shade under $40,000. What happened to Canada? It dipped. It got up to about $33,000 and then dropped to $31,000. The US continued its trajectory, getting to over $55,000 just before 2010.

We had the financial crisis. We felt the dip just like everybody else. You guys were lagging. You were about $9,000 per capita GDP per capita difference between the US and Canada at that point in time. Everybody felt the dip in 2010. We continued the trajectory up except for the hiccup of COVID and continued straight up.

Pretty much after 2010, there was a weak recovery in Canada. It looks like you got to about $45,000 GDP per capita. You dipped down to about $43,000 in COVID. You popped back up to about $46,000, and now you're on a downward trend. The US had their dip, and now we're at $66,000 and soon to approach $70,000 GDP per capita.

Canada has been stagnant, and you've been pretty much stagnant going back to about 2008 before the financial crisis. Anybody can look this stuff up, folks.

Southwest Airlines Policy Change

One of the things that's going on in the world of travel right now are folks that think they deserve something because they're special. Southwest just revised their policy where you can't just show up and if there's an extra seat, they give it to you for free, or you can buy it there at the airport if you need to pay for it. But now you have to actually buy it in advance.

So, self-awareness: you weigh 450-500 pounds, you might need three seats. You need to buy all three seats. Now the good news is, if you show up at the airport and you bought three seats because you're this wide, and there are two extra seats open on the plane, you can fill out a form, send it in, and they will refund those two seats. So it's more of a hassle—you've got to do it in advance.

Because if you do it at the airport and they say, "Ma'am, you're not going to fit in a single seat, you need to purchase another seat," you are purchasing the seat at that new price that day—not the price of $180 that you booked a month ago or two months ago.

New London Attraction

There's a really interesting new attraction that I wanted to touch on before I leave you folks. I've been to London many times, but I would go to London just to check this out. Secret tunnels that helped inspire the James Bond series are going to be open to the public with a bar.

These tunnels were built 100 feet below the streets of London, and by the time they were complete in 1942, the Blitzkrieg bombing of London had subsided because the idea was they were going to build these as secure areas. But then the subway stations became the bomb shelters. They never really opened them up, and then the military used them.

Ian Fleming, the creator of the James Bond series, was there in the subterranean headquarters. The belief is that this was the idea behind Q—remember when you go and see all the cool stuff and you're in this secret agent place. That's what it is. I love this stuff. I love spy novels, and I would find this really enjoyable. It would bring me back to London.

Closing Thoughts

Do me a favor—go over to TravelTube.com and just sign up with your email. We don't spam you. We'll just send you the newsletter every week. You'll get the latest stuff that's coming out. If you haven't noticed, we feature travel advisors and their expert insights and their video content that they create when they travel. It's open to all travel advisors.

Please follow us on the podcast apps. Even if you want to watch it on the site, at least subscribe on the podcast app. That helps our rating and gets us more visibility. The more of you that do that and share it, the more you're a force to be reckoned with when you collectively do things.

One thing you can always count on from me: you're going to hear it straight. I'm not going to sugarcoat it. But I'm also not going to stand for misinformation. When people who haven't even taken the time to understand the context of what they're commenting on yet feel self-righteous to comment, you're what they call a low-information commenter. You'd be better off not displaying your lack of context or ability to understand a situation.

The economy in Canada versus the US has diverged significantly. The exchange rate has gone from $1.03 in 2014 to $1.40, and there are a lot of factors folks—it's not always what the loudest voices want you to think.

This transcript has been edited for clarity and readability while maintaining the host's voice and key points.