Adobe can charge whatever they want because of the complete lack of competition. Other companies chose to specialise or be absorbed, so really the only viable and 'standard' option is the various CS packages. And don't go quoting things like Inkscape and GIMP and Blender - they're all fine tools, but none of them have the support and maturity that Adobe's products have, regardless of how poor that may be. Adobe is as much a brand as anything else - it makes people feel secure and carries the 'professional digital media user' aura with it.
It's not all bad, though. I have here a completely legitimate Master suite of CS4, including the various Elements programs (which are honestly what most people will only ever actually need when it comes to Photoshop - there are features worth paying for in the full editions, but if you don't know you need them, you don't) and a few others, for a grand total of $AU99.
The benefits of being in an Education industry family.
And really, the price is only insane if you're not in a professional environment. Photoshop is meant to be used for high-end things - sure, to you guys it may seem like a few thousand dollars for a piece of software is a huge thing, but consider the fact that it's meant to be used on projects whose cost runs into the tens or even hundreds of thousands of dollars, and you only have to purchase it once every 3 years (if you're insane and want to actively waste money) it's not a huge overhead. An expensive foot in the door, yes, but you've got to look at these things over a 5-6 year period and potentially millions of dollars worth of service produced, it's not an unreasonable thing.