This wouldn’t really reduce the scarcity though. Right now everyone wants a “.com”, because it’s the convention. If you could buy the TLD “widget” for the same price as “widget.com”, then you would just move up one level in the domain hierarchy and have the same scarcity? If anything, the fact that there are several legitimate TLD options reduces the scarcity a tiny bit?

As an aside (I’m also annoyed by domain squatters etc), it is a fascinating market study how domains are artificially scarce the way they are when everyone can easily and cheaply buy them. I am not sure there is any reasonable solution to it.