Not bureaucracy, that can be reigned in easily from the legislature.
The problem is there are a lot of things in local minima (or maxima if we're optimizing for maximum of some goal function).
The Penn Station story is very illustrative of this problem.
Klein writes that too many people vetoed it. But that's not what happened. No one had put up the money to do what they wanted. Every stakeholder wanted to get off easy. Sure the MSG owner did not want to move for free, neither the USPS, but why would anyone expect them to do for free?
The Federal decision to move the USPS was easy, but then no one reigned in them, so they were able to simply procrastinate for a decade. Why? Because no one gave a fuck about it in the administration. (How hard it would been to order the site manager to move in 2 years or get fired, and assign someone from MTA to check how the move is going? Easy peasy, but no, nothing like that happened.)
And ultimately NY/NJ/AmTrak doesn't want to pay for a new station, because they don't have the money for it. (To buy buildings, land there, to do a megaproject in the heart of Manhattan.)
And it's not even one institution, but many on many different levels.
And the solution seems simple, make it one, and give it a revenue stream, but don't allow it to spend it on anything else, and eventually it'll solve the problem.