How did Internet Explorer up until version 9 get to be so bad (relative to Chrome, Safari, and Firefox)?

Microsoft's vision of the Internet browser
They feel that Internet Explorer is already sufficient for the average user. This led to the restructuring of the Internet Explorer team, with the efforts focused elsewhere, and Internet Explorer informally dubbed to be in a "maintenance mode", indefinitely.

Work culture
The average Microsoft employee is simply geared at making a "good product"; but not an innovative one. They expect 1:1 - doing their job, then get paid for it.

Microsoft itself, furthermore, is keen on a top spot and nothing more. In this age with Google and their Google X projects (i.e. aggressive, absolute innovation), this old culture spells trouble.

Age of codebase
Internet Explorer itself is locked down to code which has been established since 15 years ago. Efforts have been made to modernise it; but unlike Windows Phone 8 - which they claim to be coded totally from the ground up, Internet Explorer is not so.

Proprietary technologies
This has been true since the Internet Explorer v Netscape Navigator war - both vendors have been developing their own standards. Today, it is still so. And a closed solution, bundled with less-adept programmers, further aggravates the situation.