I do not think that's it. I think that many people are very capable of delivering decent work, but they choose not to.
This begs two questions, why are people not interesting in delivering high quality work and why are people accepting low standards of work quality?
>There's a culture of indifference, an embrace of mediocrity.
Let's not be too kind here. This is not mediocrity. A mediocre worker would be someone who performs his work satisfactorily, but does not ever go beyond his duties. The person you described certainly is not that, corrupt, lazy and lecherous would describe her behavior.