I think pensions end up being a big factor. A city of 100,000 people is going to have some trouble keeping up the payments owed by the former city of 200,000. I guess as a society we need to remember to be really careful about promising compensation and then finding funds for it later (pensions were also a big factor in bankrupting GM and Chrysler).
I've been able to travel into Detroit a few times sense moving to Ann arbor and the difference is truly shocking. Even more so when you consider the distance between the places (about 45 minute drive). I highly recommend checking out Detroit in person if you get the opportunity, pictures just simply do the place justice.
The west side of the state is nice, but it doesnt really compare to the larger (and wealthier) markets on the East side of the state:
Birmingham, Bloomfield hills, Troy, Ann Arbor, Royal Oak, Ferndale, Grosse pointe, etc.
The far more obvious dichotomy is Oakland county vs Wayne county.
Wayne county(county where Detroit is located):
>About 18.6% of families and 23.7% of the population were below the poverty line
Oakland county (county just north of Wayne):
>About 3.80% of families and 5.50% of the population were below the poverty line
Kent county (grand rapids location):
>8.90% of the population and 6.30% of families were below the poverty line.
Source: lived in Michigan 22 years
I lived 2 hours away from there in Central Michigan from end of 2008 - 2010. One of the sadder experiences I had was, one day while out on my daily walk around the neighborhood, there were a mass of people standing around one of the houses. I walked up to see what was happening, and the entire house and all of its contents had been abandoned without packing; little kids toys scattered on the floor where they played, wheel borrows, brooms hanging in the garage, plates on the kitchen shelves -- all being auctioned off one after another. They were literally taking them out of the cupboards and off the floor and an auctioneer (presumably hired by the mortgage owning bank) went down the sad road of dispensing of everything to anyone who wanted it.
And actually there were three auctioneers -- front yard, back yard, and inside, gradually dismantling an entire family's life for anyone to see, and participate in.