Jonathan McPhie, Product Manager at Google, explains why Google Web History is enabled by default:
We've found that it is difficult to articulate the usefulness of having Web History turned on without trying it out for yourself. This is because the changes are subtle and vary from person to person. Having this feature on by default allows users to enjoy the benefits of personalized search without going out of their way to turn it on. And this option is one of only two that we show when signing up for a new account (the other is "stay signed in"), so we feel like it has a fair amount of prominence in the process.
Google Web History can be temporarily paused or even removed from your Google Account. Initially, Google Personalized Search was an optional feature and users had to manually enable it. Now Google personalizes search results even for users that aren't logged in. If you're not signed in, Google personalizes search results using "up to 180 days of signed-out search activity linked to your browser's cookie, including queries and results you click."