They allowed fear to rule them. Letting fear rule you allows stagnation. Stagnation leads to a decline in many aspects, which leads to the very situation the magical world is in now. A dark lord coming and attempting to overthrow the weak government. I couldn’t really fault Voldemort to be honest. The Ministry had made a lot of bad calls that caused a weakening in its people. Though I know that his main reason was for power. And his fear of death. Not sure why he was afraid. Death wasn’t  that  bad, at least the act of dying wasn’t. The being itself was an asshole from what the elder Archfeys mention. Then again, Archfey did defy the being by accepting the reincarnation gift from Magic. 