For all of you who said "then abandon it, that's capitalism", what you are leaving out is that things like subsidized transit, subsidized airports, subsidized roads and subsidized ports are what allows capitalism to operate,if a private provider took over the subway systems the fare they would charge would hurt the city, same with commuter rail, the profit motive would mean it wouldn't do what it is supposed to do. Talk to someone in cities like Atlanta, Phoenix and the like, that depend on the automobile, will tell you that traffic is choking economic growth and is discouraging them from being able to attract people to move to the regions, one of the reasons NYC has been booming is because the NYC metropolitan area has mass transit, NJ Transit, MTA, and of course the subway system. That mass transit is one of the reasons it is attracting young, talented people to live here, they like living in a place where you don't have to live in trafffic jams to get to work.
NYC riders pay a larger percent of operating costs than almost any other transit system in the country, around 50% of the operating budget is from fares. And estimates from regional plan associations say that every dollar spent on transit by governments has a multiplier factor of 4 or 5 with return in revenue (not necessarily tax revenue, though given how much NYC sends to the state, and how much it gets back, it likely is that for every dollar they spend, they get back multiple dollars in increased tax revenue from the city).
NYC is in a somewhat unique position, the vagueries of NY State law means that a lot of things that go in the city are controlled by the state, there is an approval process involved and there are things like education that the state decides for the city, they don't make policy. NYC is in a boom time, this isn't the 1970's, and they give a lot more money to the state then they get back, a friend of mine, who is a journalist and knows the NY State government, said the City, including things like transit, get shafted and the money they could have gotten (which they themselves supply), often goes to subsidize the rest of the state, especially the upstate region where to curry political favor Cuomo has been creating all these 'economic empowerment zones' that despite what the commercials claim, have cost a lot more than they have created.
The city is also known to hurt itself, one of the reasons the MTA was created was because of issues with the old NYC department of transit and how it was run. Among other things, in the 1950's those running it foolishly decided to 'run it like a business', and in the process of doing that they deferred maintenance all over the place, didn't do capital projects like the 2nd ave subway (in part thanks to Robert Moses, who hated mass transit), and had so much political infighting they couldn't get the job done. The MTA came about with the collapse of Moses' power, and in part allowed toll revenue from the TBTA bridges and tunnels to subsidize mass transit when it was all absorbed in (despite what supporters claimed, when they finally opened the TBTA books once Moses was run out of town, they found out just how much his machinations cost the city, and also the graft and corruption that was siphoning off funds), the MTA was also there to tie in the commuter rail network that private railroads had run into the ground then abandoned, the lIRR and NYC.
I ride the subway every day, I take the E train, and based on experience there are problems. This is nothing compared to the 1970's, where the trains were covered in graffitti and filthy, the trains broke down at levels that were incredible, track fires, broken chasis, derailments, and air conditioning? you had as good a chance at hitting lotto it seemed then to find an air conditioned car that worked (back in the 1960's, NYC transit claimed it was impossible to air condition the trains, they built an experimental car that had a)too small a compressor setup and b) located it in the roof, where it couldn't be maintained, it broke down, and they said 'see, we told you"..until someone pointed out path had been running air conditioned trains starting in the late 50's). It was truly bad, and ridership was at all time lows, and even when they bought new equipment it seemed to come from the factory defective, things like motors burning. The real problem is ridership is at near all time highs, and this ridership is concentrated on certain key lines, and when problems happen it is affecting the bulk of the people using it (in 1947, the prior record year, the traffic was likely a lot more disbursed). The mess in the 1970's was caused by many years of deferred maintenance and lack of spending on the system in general, the problems today are the city has boomed over the last 25 years, places like the South Bronx are starting to gentrify, but there was little work done to expand capacity. The irony is with all the building projects you see, many of which favor incredibly high end apartments, with all this growth, little to no new money has been sent to the transit in the city. The MTA sold the air rights for the so called Hudson yards project on the west side, and they sold it for relatively cheap, and apparently the money was siphoned off and not used toward improving the system (and that Hudon Yards project, despite the fact it has luxury housing, is unlikely to give much in the way of additional tax revenue, that and other high end projects have tax abatements where they don't pay any property taxes for anywhere from 10-20 years).
The signal system is probably the biggest piece, the signal system was last revised back in the 1950's, and it needs upgrading, they can't run trains at quick intervals because of it, and the system as it exists isn't all that different from the system that was put in place in 1904.
The cause isn't Diblasio, I don't like the man at all, but the mayor has little to do with transit, it is controlled by the state, and the state has cut back money that probably should have gone to MTA projects to use elsewhere. Put it this way, with the boom that hit NYC since the early 1990's, with all the business going on in NYC and all the tax revenue that is generated, they should have been able to spend serious money upgrading the system, but instead the state has actually cut back on subsidies to the MTA, and that money went to pet projects elsewhere in the state, to currry political favor with upstate voters.
The real problem is as someone else said, there is a lot of antipathy at all levels to mass transit until a crisis strikes. For example, last I heard Chris Christie, who is no fan of mass transit (ask people who ride NJ transit about how much fares have gone up since he took office, thanks to slashing state money allocated to NJ Transit), is suddenly concerned about the Hudon River tunnels, and supposedly is lobbying hard for the Amtrak Gateway project to be done, after being the person who canned the ARC tunnels (partly for a real reason, not connecting it to Penn Station, but mostly for mythical costs to NJ that almost everyone since has said was an excuse that wasn't true, and that he canned it because he thought if they didn't build the tunnels, it would cripple trains into NYC and would result in jobs going to NJ). What happens is people strip it of funding, claim it is badly run, inefficient, they cut budgets, they slash spending, and say "see, it is working just fine"...until it comes time to pay the piper, then you have 'crisis!".