Hanson's paper is making the point that economic growth (measured as gross world product) has been increasing faster than exponentially for a long time, or more precisely that it can be modelled as an overlapping series of exponentials with rates that have increased with each characteristic epoch.

It doesn't say the same is true of population growth, at least recently, and certainly we're lucky that population growth is easing away from its previously exponential (in the recent past) and super-exponential (going further back) track.

But I really take issue with is the idea that because super-exponential growth has gone on for a long time, it's a priori plausible for it to continue for quite a while.  In fact, the more super-exponential the growth function, the less reasonable it is to extrapolate that way from the past!  In the extreme case, you could have a pattern of very little growth at all until the last 10 years, where you have hyperbolic growth taking off towards infinity in another 10 years.  Few people would suggest extrapolating on that basis.

As a side note, I'd bring up Jared Diamond's Collapse and point out that in many regional instances neither economies nor populations managed to maintain (super-)exponential growth.  Since until very recent centuries human history is a sum of generally isolated regional human histories, we would do very poorly to ignore these natural experiments now that we have in effect only one big population.

Now, I'm not arguing that economic growth as measured by world domestic product can't continue steady exponential growth, or perhaps even super-exponential growth, though I have severe doubts about the kind of Singularity Hanson appears to entertain purely from the models.  

(GDP/GWP may be a bad measure of economic activity going forward, but that's a whole other discussion)

But our ability to increase economic activity in that fashion is available only to the degree that we can divorce it from whatever physical limits the Earth presents us with. Nanotechnology, super-low-powered computing, virtual worlds (and the potential huge economies they could bring) are all wonderful things which may allow us to markedly increase our economic activity and personal utility ... but they don't do anything to solve the very pressing issues around energy and other physical resource issues (topsoil, water, etc.)  

Dropping energy per GDP is by itself of little use; there's no sign that rich countries are yet spending enough of their wealth on intangibles and services to stop increasing their total (or even per capita) ecological footprint.  We've been granted a demographic gift of a population that may stabilize on its own below 10 billion in this century, but that bit of luck will be of little use if we rely on luck (or price signals alone) to prevent the pain and dislocation of resource scarcity.

Dropping energy per GDP is by itself of little use; there's no sign that rich countries are yet spending enough of their wealth on intangibles and services to stop increasing their total (or even per capita) ecological footprint.
Well, every little bit helps.

There's a confluence of factors going on now which bear examination, and probably merit encouragement:

  • The general increase in GDP/energy.
  • Increasing amounts of energy from wind, solar and biomass.
  • Technologies under development which use gasification to convert coal, biomass or waste to liquid fuels; these could be used to make petrochemicals as well or instead.
If you push these trends a little harder, we might see economic output continue to go up and energy use continue to increase for a while, but fossil energy might start to shrink as it's replaced by renewables.  The same technology which lets Rentech make ammonia and F-T diesel from coal would let DuPont convert corn stover, sugar beet pulp and waste plastic of all types to fresh new monomers.  New and remodeled buildings could be insulated and draft-proofed with urethane or styrene foam, slashing energy requirements.

Relying on price signals is probably a bad idea, as you suggest - unless those signals include mortgage credit limits.  If people are not allowed to borrow as much to purchase homes with high energy expenses (and thus payment risks given volatile prices), at least one of these problems will be addressed in a timelier fashion.