I like this idea, but for it to work how we want to, having immigration unregulated isn't quite the right way to put it. Immigration needs to be free, perhaps by contract between charter cities.
There'd need to be protocols for the creation of the cities, for the transfer of land between them, for them shutting down, and so on. Perhaps this could be organized by a meta-government. I'm not sure how well a decentralized system would deal with that.
The barriers to entry would be very high, unfortunately, and while I'm not well versed on the economics of the development of monopolies, it appears to me that there might need to be some kind of regulation to prevent them from developing and allowing new charter cities to enter the market somehow. Unless the division of land was predetermined and static, which also solves the previous problems of land transfer and city creation.
In the end this ends up being a substantially less elegant system than initially imagined, but that doesn't mean it's still not potentially far more elegant and effective than the system we have now. States are supposed to operate and compete in a similar manner, but there aren't enough of them for that to work well enough and AFAICT the federal government plays a much larger role than is ideal.
Forgive me if I'm being stupid, I only get over my social anxiety enough to post if I'm a little bit drunk.
Or is the convention against discussing politics here silly?
I propose a test. I'm going to try to lay down some rules on voting on comments for the test here (not that I can force anybody to abide by them):
1.) Top-level comments should introduce arguments (or ridicule me and/or this test); responses should be responses to those arguments.
2.) Upvote and downvote based on whether or not you find an argument convincing in the context in which it was raised. This means if it's a good argument against the argument it is responding to, not whether or not there's a good/obvious counterargument to it; if you have a good counterargument, raise it. If it's a convincing argument, and the counterargument is also convincing, upvote both. If both arguments are unconvincing, downvote both.
3.) Try not to downvote particular comments excessively, if they're legitimate lines of argument. A faulty line of argument provides opportunity for rebuttal, and so for our test has value even then; that is, I want some faulty lines of argument here. If you disagree, please downvote me, instead of the faulty comments, because this post is what you want less of, not those comments. This necessarily implies, for balance, that we not excessively upvote comments. I'd suggest fairly arbitrary limits of 3/-3?
Edit: 4.) A single argument per comment would be ideal; as MixedNuts points out here, it's otherwise hard to distinguish between one good and one bad argument, which makes the upvoting/downvoting difficult to evaluate. (My apologies about missing this, folks.)
I'm going to try really hard not to get personally involved, except to lay down a leading comment posing an argument against abortion, a position I don't hold, for the record. The core of the argument isn't disingenuous, and I hold that this argument is true, it just doesn't lead to my opposing abortion. I do not hold the moral axiom by which I extend the basic argument to argue against abortion, however; I'm playing the devil's advocate to try to help me from getting sucked into the argument while providing an initial point of discussion.
Which leads me to the next point: If you see a hole in an argument, even if it's an argument for a perspective you agree with, poke through it. The goal is to see whether we can have a constructive political argument here.
The fact that this is a test, and known to be a test, means this isn't a blind study. Uh, try to act as if you're not being tested?
After it's gone on a little while, if this post hasn't been hopelessly downvoted and ridiculed (and thus the premise and test discarded as undesirable to begin with), we can put up a poll to see whether people found the political debates helpful, not helpful, and so on.