The problem is that the IT dept is becoming less IT literate...
The industry has expanded very rapidly, and demand for skilled people has massively outpaced demand. This is then coupled with vendors who try to claim their products don't require highly skilled staff to manage them.
Also as you point out, people are becoming more IT literate but this can be dangerous, as these people often think they know a lot more than they really do and are prone to breaking things. These are also the kind of people who try to move into IT and become cheap but barely competent staff.
And a lot of problems aren't down to budget, more competent staff can do more with less resources... It is incompetent staff who will just try to throw money at a problem rather than studying the issue properly.
I long for the days when the IT dept was staffed by geeks who understood the technology and had enough of a keen interest in it to spend their free time learning about new technologies. Now you get an IT dept full of suits who learned what little they know on a few short courses and have no interest in learning anything new.