Too many obtions, too many distractions for our youth, nobody likes getting dirty anymore. I'm not sure lack of money is the main issue, there is plenty of money around just not much of it is spend on racing anymore. The exception to that is the modifieds around here they draw fifty cars all the time, more than the cheaper classes.
One grass root's racing that is alive and strong is MX, the local track here draws at least 300 riders every weekend they race sometimes over 500. Drop a couple wheels and have fun on the cheap, its more fun anyhow.