People continue to buy their products, even knowing that they're likely riddled with security holes. Until that changes, or we get lemon laws for software, not unlike virtually every other consumer product sold, there's no incentive for Microsoft to do anything. New features are what move products in the Microsoft world, and new features often have unintended consequences.
They wouldn't even be doing as much as they are now if it weren't for Linux and Mac OS X looming on the horizon as potential threats. After successfully killing off Netscape, Internet Explorer was left to rot until Mozilla started shaping up to be a threat worth taking seriously. Windows Media Player development suddenly picked up right around the time iTunes started to become a smashing success. Office 2007 will likely be one of the biggest updates since Office95, which seems to coincide with OpenOffice coming of age. These things are not mere coincidences.
Until people stop buying Microsoft products, particularly updates like Windows98, which was a warmed over Win95 with a bunch of security updates rolled in and IE4 bolted on, it's never going to change.
If you want to do something about it, I'd start by weaning yourself off Microsoft programs. Start with Internet Explorer, and then Office... Find alternative, preferably cross platform, programs for everything you can. They don't have to be free. Buying a copy of WordPerfect Office can help send a message just as well. Ultimately, the goal would be to migrate to Linux, or some other non-Windows OS, or buy a Mac the next time you're looking to upgrade systems.
Nothing else is perfect, it's impossible to have a modern operating system that is completely without defect. So it becomes a matter of design philosophy. There's the Microsoft way, where security is secondary to usability, and there's the way of trying to find a balance between the two. The latter represents almost all open source projects, and even Apple to a lesser extent. Nobody's perfect, but not everyone throws caution to the wind quite like Microsoft, a company that has given new meaning to the word arrogance.