In 10-years, a modern smartphone/computer will be able to run the full processing node if the Max_Block_Size remains 1MB. This is a clear economic benefit for Bitcoin: Decentralized Bitcoin verification. In fact in a few years, virtually every computer will be able to process the entire blockchain without issue thus making Bitcoin extremely unique in the realm of payments.
What is the use of having portable devices act as full nodes if you can't (because of fees) use bitcoin for purchasing anything smaller than a house? As I see it, your argument is not valid. With 1MB blocksize limit, even if Bitcoin remains a relatively small niche currency, the limit will act as a hard constraint on the potential utility of the currency. Of course, once we start hitting the limit, it will hurt Bitcoin's public image so much that it's conceivable so many people will move away from Bitcoin that we get few more years of time to fix the issue.