Unless you have a Platinum American Express Card that allows you access to the airline club lounges, you may want to start leaving that card at home.

American Express just announced it is raising its foreign transaction fee from a pick-pocketing 2 percent to a “hand over your wallet” 2.7%—a 35% increase that is pure profit. So if you charge $1,000, Amex takes 27 more of your dollars, even if you’re already paying them hundreds of dollars a year as a platinum card member that has been with them for decades. Many merchants just received a fee increase as well, which means the company is double-dipping to make up for its bad credit decisions over the past year. (It’s not just your tax money that is going toward a bailout.) Plus they skim a profit from the exchange rate as well, keeping a bit for themselves in every transaction. When a company can have three streams of income from a single purchase and still lose money, do the executives really deserve to earn millions in salary?

Right about now you’re probably thinking, “Yes, but doesn’t my Mastercard or Visa card charge a 3% transaction fee?”

Most of them do, with 1% going to Visa/MC and 2% to your issuer. But not Capital One. Standing by their “no hassle” commitment, Capital One won’t pick your pocket just because you charged something on the other side of a border or an ocean. They manage to make money with just two streams of income–the merchants and the exchange rate. A lot of credit unions won’t ream you either.

I’m still carrying my Amex Platinum when I travel to Peru in December, but I’ll only take it out to use the Delta lounge during a layover. The only one I’ll pull out to actually pay with abroad has Capital One stamped on it.

Here are a few more comments on the subject from Wendy Perrin and the FlyerTalk forum.

A story late last week in the Wall Street Journal noted that while air traffic is flat or sinking in nearly every region of the globe, it is up year-over-year in one region: Latin America.

In Airlines Plot Latin America Course, the Journal notes that American, Continental, and Delta were all launching new routes to the region. “International traffic in Latin America has climbed by 12.2% so far this year from a year earlier, dwarfing a global industry average of 3.3% world-wide.”

Travel is up, the Latin American economies are relatively stable overall, and so far anyway, more friends and relatives have been going back and forth.

It’s not all cheery news for travelers though. While the new routes will provide more options, we are apparently all paying more to get to those places.

“Passenger yields, or the price paid by passengers to fly one mile, on routes between the U.S. and Latin America climbed 23.2% in September from a year earlier — far exceeding growth across the Atlantic, Pacific or within the U.S., according to the Air Transport Association. Third-quarter revenue per available seat mile, an industry standard, rose 19.7% from a year earlier for American on its flights to Latin America. At Continental, the Latin America figure was 14.9%.

Also, some routes are being taken out of play when traffic drops. Delta recently cut service to Querétaro and León, the two airports serving the colonial heartland cities of San Miguel de Allende and Guanajuato.

The article didn’t address what the Latin American airlines themselves are doing to take advantage of the rising tide. In my trips, they have offered a more pleasant flying experience than the U.S. carriers, and in the case of Taca and Copa anyway, usually at a better price as well.

No, I’m not talking about Argentina’s brazen grab of private pensions. I’m talking about their decision to start slapping a reciprocal visa fee on visitors starting in January. It means that if your country charges the few Argentines that come to your country $134 for a visa, it will now cost the far higher number of your countrymen and women who go there just as much. Right in the midst of a global slowdown. Nice timing eh?

This hasn’t gotten much press yet since it doesn’t go in effect until January, but it’s lighting up the travel message boards. Word is also getting out on various blogs. You can read more on the Argentine Post blog or you can find some great insight from experienced guidebook writer and part-time Argentine resident Wayne Bernardson at the Southern Cone blog.

As he notes in another post, the dollar is now up bigtime in Chile and while that country also charges a reciprocity fee, they make up for it by eliminating the VAT for foreigners, effectively a 19% discount on hotels. In Argentina, by contrast, foreigners usually pay far more than the locals for hotels and domestic flights.

If you’re wealthy enough to be booking a tour that costs 30 or 40 grand you’re probably not going to bat an eye, but the message boards on FlyerTalk (not exactly a bastion of backpackers) is already filled with “I’ll go elsewhere” posts. You can just imagine what it will mean for those on a more limited budget, like a family of four deciding whether to go to Argentina and pay over $500 as a cover charge or go to Central America and pay zero.

And for some, it’s the principle of it that will make them avoid the country altogether. Yes, the government can spin this as an act of fairness, saying that since they have to pay that much so should we. All true in theory, but Argentina doesn’t have the security overhead or the big illegal immigration problem the U.S. and Canada do. Few visitors from Canada or the U.S. come to Argentina and stay on illegally to work. Then there’s the matter of how much tourism matters. The U.S. government seems to have taken an “if people come, they come, if they don’t, they don’t” attitude toward tourism and in the big scheme of things it probably hasn’t made much difference in the national economy. The domestic tourism industry is far bigger. If Argentina experiences a 30% drop in international tourism though—which is not unlikely in this climate—major crisis on top of crisis. It’s a far bigger chunk of their economy.

In a world where destinations are competing with each other for visitors, this move seems to go against any sense of logic. Each person traveling to Brazil, Chile, or Argentina will pay at least $100 for the pleasure of spending money in those countries. Meanwhile, those who visit Peru, Costa Rica, Panama, or Guatemala will pay nothing. Anyone who has to make a budget for their trip will take that into account. Reciprocity may be fair, but “fair” isn’t always “smart.”

Yes, things are very rocky in the U.S., but they’re worse elsewhere. That seems to be the reason behind the dollar’s dramatic rise against other currencies in the past few weeks.

One of the most dramatic changes has been in Chile. At the beginning of this year a dollar would have gotten you around 500 Chilean pesos. Today the official rate is 627. See the chart here from fxtop.com.

That 20 percent rise in value is not going to help you all that much with hotels priced in dollars anyway, but it does give you more bang for the buck when doing anything the locals do—like eat out in a restaurant. Or when you buy a bottle of Cabernet in a store.

Same story in Mexico, where their peso had dropped down around 10 to the dollar this summer and is now at 12.5. Again it doesn’t matter much for hotel bookings, but it affects your cost of a taxi ride, a driver for the day, a decadent seafood meal, or a domestic flight priced in pesos.

Latin America was a great value when the dollar was struggling hard against the euro and it’s an even better deal now. Head south and live it up instead of making hard decisions about your budget in Europe.

Flying on Copa Airlines feels suspiciously the same as flying on Continental Airlines. The interior looks the same, the seat pitch is the same (cramped 32-inch pitch in coach, decent with leather seats in business class), and the logos are similar. None of this is coincidental: Continental had a 51% stake in the airline at one point. They sold off shares a bit at a time until May of this year, when they sold the remainder for a tidy profit. Copa Air passengers still earn Continental OnePass miles on all flights, with the same (recently hacked down) bonus levels for elite members.

There’s a big difference in one key area though: service. The gate agents are noticeably less harried, the flight attendants are more pleasant, and you don’t have to pay for a cocktail or glass of wine in coach.

Here’s what happened to me though on my last trip to Panama though that really showed me what a great airline this is. Through my own fault, I had said “go ahead” to an agent who sent me an itinerary, not noticing that my flight back was returning to Miami, not my connecting airport of Orlando. A well-tipped concierge at the Bristol Hotel worked it all out for me with Copa on the phone so I could switch the flight with no charge.

At the gate, however, the system wasn’t letting the switch happen without a fee, despite gate agent Cecilia’s attempts to make it right. She spent ten minutes trying to work it out, another ten with her supervisor, then headed to a back room. Another ten minutes went by, but she returned with a smile, handing me my boarding pass, and said, “Please enjoy your flight.” All set, and upgraded to business class on my Y-up fare.

That Cecilia was dedicated! Somehow I can’t imagine any U.S. carrier’s gate agent working that hard to help a customer avoid an extra fee. Even more rare, there were plenty of agents on hand, so there weren’t people behind me in line ready to throw their suitcase at my head.

Don’t expect to get blown away by lie-flat beds, seatback entertainment consoles, or amazing cuisine, but considering that Copa’s fares usually deliver better service at a lower price than others competing on the same route, check them out when comparing options. Business fares and Y class fares are a downright bargain sometimes. Copa flies from five U.S. airports to destinations in Panama (their hub), as well as Brazil, Peru, Argentina, Uruguay, and Chile.

Copa has been named Best Airline in Central America and the Caribbean for the five consecutive years by the aviation-industry research company Skytrax.

Oddly, this is one of the few airlines that hasn’t released its data to SeatGuru.com, so you’ll have to rely on the sites own seating chart when booking online.

Related info:

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