I don't quite see how price competition between cryptos is a mechanism that optimizes security spending, unless you mean that cryptos that fail security will cr

I don't quite see how price competition between cryptos is a mechanism that optimizes security spending, unless you mean that cryptos that fail security will crash and burn. As for mining, it is necessary for reasons that have nothing to do with security. If you want to send a tx, you will pay a fee or perhaps hope for a kind miner to include your spend in a block. In no way are you signaling how much you think the Bitcoin network should spend on security.