The prior (and seemingly this) assurance contract proposals pay the
miners who mines a chain supportive of your interests and miners whom
mine against your interests identically.

The same is true today - via inflation I pay for blocks regardless of whether they contain or double spend my transactions or not. So I don't see why it'd be different in future.
 
There is already a mechanism built into Bitcoin for paying for
security which doesn't have this problem, and which mitigates the
common action problem of people just sitting around for other people
to pay for security: transaction fees.

The article states quite clearly that assurance contracts are proposed only if people setting transaction fees themselves doesn't work. There's some reasonably good arguments that it probably won't work, but I don't assign very high weight to game theoretic arguments these days so it wouldn't surprise me if Satoshi's original plan worked out OK too.

Of course, by the time this matters I plan to be sipping a pina colada on my private retirement beach :) It's a problem the next generation can tackle, as far as I am concerned.
 
Considering the near-failure in just keeping development funded, I'm not sure where the believe this this model will be workable comes from

Patience :) 

Right now it's a lot easier to get development money from VC funds and rich benefactors than raising it directly from the community, so unsurprisingly that's what most people do. 

Despite that, the Hourglass design document project now has sufficient pre-pledges that it should be possible to crowdfund it successfully once I get around to actually doing the work. And BitSquare was able to raise nearly half of their target despite an incredibly aggressive deadline and the fact that they hadn't shipped a usable prototype. I think as people get better at crafting their contracts and people get more experience with funding work this way, we'll see it get more common.

But yes. Paying for things via assurance contracts is a long term and very experimental plan, for sure.
 
one time cost. I note that many existing crowdfunding platforms
(including your own) do not do ongoing costs with this kind of binary
contract.

Lighthouse wasn't written to do hashing assurance contracts, so no, it doesn't have such a feature. Perhaps in version 2.