Whens the last time Michigan has won a national title? 1997?
There are several in your tier 2 including Tennessee who have won national titles since Michigan last won one.
Michigan are tier 2.
Tennessee won 1 season after. If you take the position that both schools were tier 1 as of the 98 season, here is how it looks since.
Michigan 210-92 70%
Tennessee 165-121 58%
Michigan 3 conference championships with a chance for 4 this weekend
Tennessee 0 conference championships 3 division championships
Michigan 7 BCS equivalent bowls plus another this year
Tennessee 1 BCS equivalent bowl
Michigan 9 10 win seasons
Tennessee 4 10 win seasons
Michigan 19 winning seasons
Tennessee 14 winning seasons
Michigan has been markedly better, even in the worst stretch since Bump Elliot