because it's art...on the street...
Art is art regardless of the legality and place it's put.
Since when is art not art just because it might be breaking a law? Illegal art is still art.
And anyways, as the other poster mentioned, many cities have areas designated to be used for graffiti. It really is an art form (not counting just the dumb spray-painted names or whatever), and it can beautify an otherwise boring place.