Why libertarian cities fail:
Libertarian ideology proposes that humans in a state of nature need never affect each other. Without laws or government, we can all revel in the freedom of solitude, making whatever choices we wish without having to care about anyone but ourselves.
The reality is, we need a society with rules because we all live together on the same finite planet. Like it or not, the choices you make affect others, and vice versa. That’s true whether you’re pumping your neighbors’ aquifer dry or attracting bears to their trash cans. The laws we have are a reflection of that interconnectedness, not the source of it.
I think that what actual libertarians (I’m not one, to be clear) would tell you is that they do not think humans need never affect one another, but rather that individuals should be left to enter into private contracts with one another to resolve these problems rather than having the government do it.
The problem is that most people do not want to have to do that, and so they band together into groups with rules—i.e., governments—to address these problems systematically.
And that is why whenever some weirdos try to go it on their own, the town runs out of water and is overrun by bears.