[jacobolus]

A few of the wealthiest suburbs in the country are enclaves of people who rely economically on the city but don’t want their property taxes to pay for poor people’s amenities and services, so carve out a separate municipality. Cities want to re-absorb these, because the current setup is grossly unfair.

This is not representative of suburbs in general. Many suburbs, especially older ones whose infrastructure construction (but not maintenance) was heavily state-subsidized, are struggling and financially unsustainable, leaving their (less wealthy) residents in deep trouble in the long term.

[criddell]

After asking this question I started reading more about it. The biggest subsidization is about mortgage interest tax deductions. I never thought about that as a subsidy, but I suppose it is. They should end it.

[arrosenberg]

Yes, and in California Prop 13 is an even bigger distortion.