Saturday, February 6, 2010

Michigan - A Tale Of 2 States

By GARY BAUMGARTEN
Paltalk News Network


DETROIT - I arrived in Michigan about a week ago fully expecting to see despair and with the sad anticipation that I'd meet many people out of work. I found that, but I also found prosperity and vibrant commerce as well.

Eight days later and I'm still scratching my head. I can't quite figure it out.

On the one hand, I went through neighborhoods in Detroit that boast as few as one or two occupied houses on one full city block. The rest are either abandoned or have been demolished.

I've met people who are out of work - from pizza delivery people to company executives. People who can't find jobs. People who have stopped paying mortgages on houses that they've live in for decades.

I've driven past shopping centers that look like ghost towns. How the merchants remain in business is beyond me.

But my first night here, I had a hard time finding a place to eat. Not because the restaurants were closed. But because they were jammed.

This was in the northern suburbs - not in Detroit proper. But still. I was surprised to learn that at the first restaurant the wait was an hour and a half. At the second, an hour and 40 minutes. And at the third, an hour.

Today, my daughter and I went to Somerset Collection Mall in Troy. It's as upscale as they come. The mall boasts both a Sach Fifth Avenue and a Neiman Marcus store. At Barney New York we found a handbag selling for a "mere" $795. I'm not kidding.

The parking lot was jammed. The mall was teeming with people. Everyone was smiling and having a good time walking around in their designer jeans (I saw blue jeans for sale for more than $200 too!)

At lunch, we met a woman whose husband was laid off as an executive at nearby Beaumont Hospital. He's been out of work for months now. A family that never has had to worry about making ends meet - she and her husband are now in default on their mortgage. They hope to get a loan modification from their bank, but they are making plans to abandon the home they bought and remodeled and to rent another if necessary.

But dinner at a nearby upscale Italian restaurant really blew me away. I didn't count them but I wouldn't be surprised if there were 10 valet parking attendants at the front door to greet us. We had reservations. Without them, we wouldn't have gotten in.

Did I mention the place was pricey? I don't know what the bill came to, but even without looking at it I'm glad that the folks that invited me were kind enough to pick it up.

I'm not exactly sure why there's such disparity here, but I have a theory. Those who had wealth before the recession still do. It's the middle class that's shrinking. We're creating a society of people with means and people without. And that's not very healthy.

The woman we met at lunch recently returned from a trip to Los Angeles. She says there were basically two kinds of cars on the road there. Luxury vehicles and clunkers. A sign that the middle class is disappearing there as well.

While most of America is suffering, it seems that those with money are spending it. This is a good thing, of course. It's good for the economy - and for those working in retail and service sectors. But it also serves as a stark reminder of the contrast between those who have and those who do not.

So while some people are defaulting on their mortgages and seeing their homes sold at sheriff's auctions - others are buying $800 handbags and $200 bluejeans.

A man who works in the automotive industry told me tonight that he's seen a very slight improvement in the economy. Let's hope for the sake of us all that that's a trend that will continue in the months and years ahead.

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