If I've assumed at least one thing correctly and by "it" you mean producers and studio heads artificially inflating budgets in order to ultimately line their own pockets and the pockets of their friends, I would find it hard to believe that there has been any point in the entertainment industry's history when that hasn't been prevalent.
As to the "why," what, you don't like money? Here, have some more money, now now do you like it? Rinse, repeat.
I'll venture that we're doing the debugging right now, as we discuss this matter. The debugging occurs every time a 14 year old reads about these issues and wonders how the hell it could be possible, let alone legal, for these entities to behave so miserably.
I'll indicate once more that I believe the root cause of this excess lies in these unsustainable institutions and the selfish people who lead them. Leave art to the artists, we'll/they'll figure out how to make money doing it, I'm sure. If you're a failed lawyer or a failed artist or just a plain-vanilla opportunist and you want to run a commodity business, sell canned peaches. Or literally anything else in the world where there's an economic incentive tied to an actual physical object, anywhere but your own mind.
"and the selfish people who lead them. "
I believe "legacy MBA" are the key words. The old MBA courses taught a lot of horrible stuff, including self-interest and control which are probably big factors.
Not what I mean. I mean things like exactly when and why they started doing it.
"I sincerely doubt that the change will come from within. "
Yea, but someone else could do the debugging and maybe fix the root cause.