I agree that miners will form pools (like we see today) if doing so gives them an economy of scale. This is similar to the production of most commodities. For example, men panning solo for gold in a creek can no longer compete with the billion-dollar+ gold miners like Barrick.
I also agree that if Bitcoin becomes wildly successful and TX volume increases 1000 times, that people will require specialized hardware and high-end internet connections to run full nodes (I'll just use an SPV wallet on my phone).
What I don't agree with is that this will lead to a negative result: quite the opposite in fact! If we allow Bitcoin to grow, I expect to see vastly more user, more miners, probably more nodes, but definitely more security in numbers. I can't prove this, but no one can prove the opposite either.
My problem with the small-blockers is that they don't want to take the chance of success and instead want to commit us to failure. You are proposing adding a quota to block space production:
My problem is these are a lot of assumptions.
To begin, the demand for transaction and space on the block chain can be considered infinite. From this reasoning we can infer that by specialized hardware & connections we really mean high-end
datacenters .
Don't even think about giving me that bs that I won't allow Bitcoin to grow. Bitcoin doesn't grow only in transactions and transactions don't necessarily mean more users. Miners, until we are able to commoditize mining into consumer hardware, will inherently be lead into giant economies of scale. "Probably more nodes" doesn't cut it either seeing the existing decrease in node count as compared to a couple years ago when Bitcoin had much less users. Finally yes, you can't prove this.
What you call a transaction quota I call a check on centralization. Remember that free market is not inherent to Bitcoin as it works under specific rules to carefully assign the players incentive. I suggest an irresponsible block size policy can change these incentives for the worst.