Rooney has typically been a very good player in a very good team, therefore he's generally appeared better than he is. He's also perceived globally, until recently at least, as one of the absolute best players in the world. This is due to the team he's been playing in and the general spin of the media, especially in England where he's the 'star' player for the national team. In fairness to him, he has produced plenty of excellent performances over the years and had plenty of iconic moments (though not for England, but everyone is poor for them so let's not even go there).
Early in his career, he was very explosive, not just due to his speed, and this is what made him so good. From the outside it looks like that has been coached out of him gradually.
His form has rapidly declined over the last few seasons, and he has been playing regularly since he was 16, so realistically his body is that of a 35+ year old, and one who hasn't looked after himself that well either.
Let us not forget he's tried to leave the club twice, both times on advice of his agent to get more money out of us - it's our own fault for paying, especially the last time, but that was part desperation due to the Moyes situation.
I don't believe he's completely finished yet, he can still contribute a bit, but the penny really has dropped now and I don't see a way back for him, short of a miracle. Moving him on before the end of his contract will be difficult due to his wages, but we can suck that up if needed and perhaps agree to pay off some of his salary if he goes to another club.
I do think Mourinho has more than likely orchestrated this to a degree, because of what a big part of our club Rooney is, and it's now clear to everyone - the press included - that he's not up to it anymore.