It is up to the market users can set the fee in their client and delegates can set the fee in their client anyone who sets a fee that's too low and just have a pending transaction forever users can then voting delegates that approve at reasonable fee.
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Great! So delegates get two knobs:
1) Fees accepted
2) % of fees that are destroyed
This is another economics/game theory problem (you can write a book on this delegate game):
1) If there is no limitation to block size, delegates should accept any fee >0. A delegate gains nothing by turning down a fee. A delegate that turns down a fee is essentially just paying the next person in line a tip. So the first knob won't do anything. However, if there is a universal limit on blocksize, every delegate will accept the largest fee per byte transaction first.
2) The second knob is more powerful, but is currently broken. In order for the % fees destroyed to reach an efficient market equilibrium, they must be allowed to go both up and down. Otherwise, the market will not be efficient and delegates will be incentived to damage the network in the event of a flash drop in price. Even though you would hope delegates should not do that based on moral grounds, the existence of such an incentive is a sign of a broken system.
I don't care about anything now since we're talking about pennies here, but I really want this system to be able to be robust in the future. My analysis keeps pointing to serious problems playing out later on which we can fix now and head off. I don't care if people are greedy at the moment, but we should really think about this economic system and if this is what we want going forward.