Why doesn't Internet Explorer have compliant web standards?
by Filipe Fortes
After IE6, the IE team was effectively gutted, a large number of them were moved onto the .NET/WPF teams or scattered around the company (including myself, I was hired out of college to work on IE, but by the time I got there I was on the WPF team). This was a strategic decision for Microsoft, who were trying to build a Windows-only platform. [The story is far more complex of course, but I don't have time to get into it right now]
IE was effectively on life support until at least 2005 or 2006, and probably understaffed for a while after that given security requirements. Key experts had long moved onto other teams, leaving less experienced folks to deal with bugs and security patches. The staffing has been far better for a few years now (I have quite a few friends on the team), but it was dire for a while.
Jose's point is also important, IE gets crushed by backward compatibility requirements that you wouldn't believe (think IE-only intranet apps). It's not an excuse, but it is definitely an additional burden that new browsers don't have to bear.