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Actually the whole thing is Vince's fault.
I don't think there is anyone in the history of the business who got away with as much as Shawn did. I don't know if HBK really was McMahon's boytoy on the side, but it's baffling how a control freak like Vince allows Shawn so much sway. Maybe with business in the shitter, he was worried about Shawn jumping ship if he tried to reign him in.
If Vince had put his foot down squashed shawn's bullshit early, and tried to help shawn with his problems and get him to act more professionally, maybe Bret would have been more open to the idea of dropping the title to him.
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