I live on the outskirts of downtown Salt Lake City. There IS a grocery store within walking distance of my house, but I try not to go there because the service is pathetic. Thinking of SLC...yes, a lot of people in the downtown area have to drive a bit to get to a regular grocery store, even further for a Wal-Mart, and even further for a Target. Me? I like that. If I wanted to have the "amenities" of the suburbs, I'd live there. I enjoy not having a huge shopping center close by...I don't have to worry about the throngs of people, noise, and traffic that go hand in hand with "progress".
As far as the actual city setup goes...my guess is most larger cities have an older downtown built before Wal-Mart existed. It's hard to fit a Wal-Mart in an area that wasn't designed for McMansions, big box stores, strip malls, and large parking lots needed to service them. People used to shop at Mom and Pop type stores that weren't much bigger than the surrounding houses. In SLC, those out-of-business stores are now unique bakeries, small restaraunts, florists, and music shops. It can be a pain when I need to go to a mall or something, but the tradeoff of that infrequent inconvienence and having a quiet neighborhood is worth it to me.
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"They say that patriotism is the last refuge to which a scoundrel clings; steal a little and they throw you in jail, steal a lot and they make you king"
Formerly Medusa
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