Your analogy would indicate that you don't understand how merged mining works.
[...] If your hash solves a Namecoin block then you get some Namecoins for it. But that in no way shape or form affects Bitcoin.
Ok, I forgot to mention in my analogy that when I fill my 2 fuel tanks, I only pay to fill the first one while the second one if free. Please, stop assuming that all people criticizing merged mining don't understand how it works. It prevents you from getting the bigger picture, ie leaving aside the technical details to start thinking about what the PRACTICAL impact could be.
The practical impact is, if you generate one coin A AND one coin B instead of generating only one coin A OR one coin B (from the same effort), assuming that the global value you are generating is the same because it's a function of the cost to generate it (that seems like a fair assumption, although I'm aware it's not certain and probably not 100% accurate either), then the value of coin A and the value of coin B are likely to be averaged, ie to tend toward (original value of A + original value of B)/2. That's not a decrease yet, but when we add to this the fact that mining becomes, say, twice as difficult on average (in the case where there was an even mining power for A and B), the result of mining is (original value of A + original value of B)/2/2*2 (the last multiplier is because we now mine 2 coins instead of one)=
- the same as before, if coin A and coin B had the same value/diff ratio at the beginning,
- or lower for someone who was mining the coin with the best value/diff ratio
- or higher for someone who was mining the lowest value/diff ratio
So, the only winners in the process are those who mined the coin with a lower value/diff ratio, aka probably just a few gamblers, or a few people who didn't do the math.
Again, I'm not saying merged mining would directly decrease the global generated value. Just that it will split it over several ccurencies, rendering it less PRACTICAL to use, which in turn has a chance to actually decrease the generated value (because not practical = not wanted).
For BTC vs NMC, it seems like it didn't occur (yet, at least) because BTC has so much more support behind it (I don't mean customer support there
, just users and even merchants) that the coin value was indeed unlikely get averaged. For LTC vs TBX/FBX, which all have like zero merchants, well, I wouldn't be so sure. Since the only ccurrencies/users that can really benefit from merged mining are those with sub-average value/diff ratios, well, you can guess who would make a good deal (and who wouldn't) by merging the mining for LTC-TBX-FBX.
Of course, this is a very over-simplistic economical model, but that's the risk. If I'm already on the best ccurrency, I have no reason to want it to be merged with junk ccurencies. But if it does get merged, of course my best option then is to follow the move and merged-mine.