Actually Satoshi always intended the block size limit to be raised. I queried the size once (as part of a longer conversation about scalability) and he said this:
A higher limit can be phased in once we have actual use closer to the limit and make sure it's working OK.
But that's it. He didn't elaborate on how he imagined it being phased in or what "working OK" meant. Satoshis view was always that Bitcoin could scale up more or less forever. I was quite skeptical back then, but I came around to his way of thinking with time.
gmaxwells point about the relationship between block size limits and fees is valid, if you agree with the following statement:
There _must_ be competition for block space to make fees a viable way to pay for security.
However not everyone does agree with it. For instance, I believe that coalitions of entities interested in maintaining certain network speeds can and will build network assurance contracts (contracts that spend all their inputs to fees), thus funding the public good of security. I don't think competition for entering blocks is the right funding model.
Fortunately, there are ways to resolve these debates amicably. For now of course we can just ignore it. We're not close to reaching the block size limit nor are we close to losing inflation as a funding source. Later on, we can use the usual mechanism for phasing in rule changes - have new block or transaction version numbers express acceptance of the new rule set and automatically begin enforcing them if/when more than a certain percentage of users have opted in (probably a very high percentage).
I think these debates will gain clarity once inflation falls again and we start seeing merchants losing money with some degree of regularity, due to double spends. If assurance contracts are going to work, it'd make sense that we find out at that time. If it's shown that they can work, a lot of the arguments for small block sizes go away (especially with software that scales much better).