I’m not sure if pointing the finger at anyone or any series of events will help me feel better about my observations over the last week as I have traveled through Italy. This year I traveled to Lake Como, Bologna, Parma, Siena, Montalcino, Orvieto, and finally Rome. I’m writing this blog post from my hotel room in Rome with a deep sense of loss.
For the past 15 years I have taken my annual pilgrimage to Italy with great joy so it is with great sadness that the luster has faded from my favorite European county. The many attractive perks that this country once offered Americans are gone. Even the local residents look sad and I don’t blame them. With 15 year of travel to Italy as a perspective, in normal times the amount of tourism revenue would be twice what I observed on this trip.
Restaurants that were normally packed, are half filled. Shops that were once bustling with activity, have little to no traffic. Few tourists or residents were walking around with shopping bags indicating a recent purchase.
One morning, I ran through Siena on my morning jog, and the shopkeepers sweeping their sidewalks and washing their windows had no visible joy or energy. It reminded me of the movie “Ground Hog’s Day” with Bill Murray; these people were getting up each day facing the same economic challenges with no light at the end of the tunnel.
The Devaluation Of The US Dollar
The most obvious challenge today is the Euro to Dollar conversion which makes basic travel costs impossible for the average American. When a buffet breakfast at a 4 star hotel costs $60 per person, you can see how my patience is being tried. Fortunately, a great shot of espresso (cafe) is still less than 1 Euro.
Small local bars offering two eggs, toast, coffee and a juice are price at $15-$20 per person. Italy, which was once an amazing value for food, is no longer attractive to dollar holding tourists. Imagine the food costs for a family of four traveling in Italy, and you can see why less American’s are coming to Italy in 2011.
For lunch, a simple plate of pasta pomodoro, bread, a bottle of water, and cover charge will cost one person 18 Euros or about 27 dollars. That’s without coffee and dessert.
Will Americans Stay Home
With these food prices, and a $1,500 coach ticket from Newark to Rome, will American’s continue to stay home? A US family of four that spends one week in Italy in a city like Rome, and that would need two hotel rooms, would look something like this:
- Airfare: $6,000
- Hotel Average Night: $250 x 2 = $500 / night (min)
- Hotel For Week: $3,500
- Food For Week: $4,000 (min)
- Taxi & Tours $400 (min)
So, without any gifts or extra special events, it would cost a family of four over $15,000 for one week in Italy. If you want a rental car, budget another $1,000. There are many places in the US a family could explore for a week and spend much less than $15,000.
I will not go into shopping prices but suffice it to say that the Nike store was 50-60% more expensive than back at home so there are no real bargains anymore with the dollar in such a devalued condition.
The Bright Side
As American’s come to the realization that their dollar is no longer the powerhouse it once was, will it awaken our country to keep our fiscal house in better order. Will we demand changes in how Washington manages our money and investments which impact the future of our country?
I know the weak dollar will keep more Americans at home, which may also be a good boost to our economy. For now, the Italians have no choice in making their country more affordable to Americans. This of course is part of my sadness because both nations have always enjoyed a mutual respect and exchange of tourism.
For now, it look like the Italians will have a better deal if they come to America.