[toyg]

I think the main difference is that the overall level of violence in society has gone down so much that people simply don't know how to react anymore. In the past, violence was much more present in everyday life: wars were more common, criminal activity was more common, law enforcement was lax or even non-existent, so people had to literally fight on the streets day by day just to survive. Women wouldn't go out alone even in daylight, most men were supposed to carry some sort of weapon as soon as they stepped out of walled towns (and often even while inside) and so on. After WWII, there were so many veterans around that you wouldn't dare starting sh*t for fear that somebody would kick your ass in 5 minutes.

Nowadays, people like me wouldn't know the first thing about hitting someone or defending themselves. My childhood home was in what we'd consider "a bad area" of a Southern European city (mafia and all that) but even there it took very little care to stay out of trouble. I don't think I've ever been in a physical confrontation with anyone after my 18th birthday; I wouldn't know how to use a knife or a gun, nor how to protect myself from it. Law enforcement and cultural pressure are now so efficient that they can usually limit violent activity to specific areas, so as long as I stay away from those, I'm very likely to be safe. (Every city has different attitudes and problems, of course, but that's more or less true for most of them)

If a random stranger started knifing people in my subway carriage, I'd probably freeze too - I'm a family man, not a goddamn soldier or street-fighter. Same for witnessing something like what OP describes.