Nikanj isn't wrong (and is funny), but I think the other (more justifiable) reason is that jQuery largely isn't necessary anymore: when it came out, there were an uncountable number of browser incompatibilities that needed painting over, and APIs for remote requests, DOM querying & manipulation and the like were very immature, so a library to make everything usable was extremely valuable.

Now, those APIs are mature & standardized & it's generally not too hard to write vanilla JS that works across all the major browsers.

I don't think jQuery has failed, but for the kind of baked-in functionality Rails wants it's not really needed, and there are good reasons not to pack another dependency into your framework if it will increase page download size & is increasingly unlikely to be used by the framework's users.