I dont understand what you are implying. Are you saying that NIMBYs will come after you?

It seems weird but you have to look at the market effects evangelist perspective to understand their position. A person believing in these forces might say that by having a large day laboring population and not building housing for them, there is now strong incentive for other areas to approve new housing and take advantage of guaranteed demand. And then they might go on to cite a location like (EDIT: not daly city but there is a bay area city that recently approved a ton of apartments whose name escapes me) that has taken this approach and really changed their municipal budget for the better as a result.

However, the market evangelists don’t understand that just because there is a business case to do something, doesn’t mean anything should happen either. People and therefore their markets don’t operate on entropy alone. There is a lot of irrationality that is hard to quantify.

You are assuming infrastructure costs would be the same for a 10x denser population. I’ve read articles where even on a per capita basis just about everything is more costly in dense cities, from sewers to schools. It would take some careful scrutiny to identify what is actually optimal, and I expect that to depend heavily on the local economy. For example maybe the fact that the lima peru skyline looks like lima peru and the san jose usa skyline looks like san jose usa is as simple as being due to the cost of labor and materials and what best pencils out. Of course we won’t know the answer to that experiment without removing zoning limits on density and seeing how the market responds over decades.

Sewer, water, and electricity hookups are cheap to maintain and are on the burden of the home owner to repair. The initial hookups and construction are absolutely not covered by taxes (this is one of the significant costs you will find out when you build on a plot).

Street pavement is the only thing you mentioned that does cost the tax base, but how much the poor dense area subsidizes the suburbs is completely dependent on the split of funds. In many of the suburban sprawl regions of the western US, the dense urban city (e.g. San Francisco, Seattle, Portland, LA) has a small jurisdiction and the suburbs are in completely different legal cities with their own road budgets.

>cities, poorer and denser neighborhoods are subsidizing the richer suburbs, tax-wise.

Definitely not well established. What you might be thinking of is poor dense neighborhoods subsidizing rural areas that depend heavily on federal or state grants for pretty much all of their infrastructure.