Why does straw help grass grow?

It does 3 things:

1) breaks the fall of raindrops so you don;t get soil splatter, moving the seeds out of place. water will drip instead

2) shades the seedlings from the sun, keeping them from getting too hot.

3) along with (2) helps retain moisture by absorbing water and keeping the air more humid about the seeds .

That's the HOW part.

About WHY?

You'll have to consult Maledil, or at least the Oyarsa of Malacandra

If you are talking about grass seed, the straw helps hold moisture so the seeds can germinate. The straw also stabilizes the soil so the soil and seeds don't wash off in the rain. Shredded straw works best.

it also makes it harder for the birds to find the seeds once you scatter them...