Going to discos or 'clubbing', which is the modern term, survives in Europe because it makes money. Why it doesn't in the U.S. (except in the 'hipper' areas of large cities) is anyone's guess. By the way, hordes of youngsters in Europe also consider a good time to consist of drinking their faces off - it's virtually a national problem in some countries.

I have an inkling that the demise in disco in the U.S. stems back to those times just post-disco in the late '70s when the whole disco movement was derided so heavily that it fell and has never fully recovered since.
For musicians, you'd think this wouldn't be a bad idea but in this neck of the woods the shift hasn't really swung back to live music. People have instead retreated into their basements with their 'home theatre' systems, sipping cappuccino; 'Cocooning' as the modern parlance goes. Add to this the rise of the so-called 'sports bars' with their 10-foot tv screens and free peanuts and you have, in a nutshell, if you'll pardon the pun, why too many people have never experienced the joy of spending an evening dancing the night away.

What a shame.