I think the evidence is to the contrary, namely, that economic growth, in the modern financial sense, is predicated on increased energy consumption.

Based on what evidence do you believe that?

Yes, it's surprising (at least to me) and a little counter-intuitive that per-capita GDP has gone up so much despite per-capita energy consumption going up so little (or not at all), but that is the fact of the matter.  Accordingly, our theories should be based on what we observe, not on what we believe.

I cannot concieve of a situation where decreased energy consumption could lead to a growth based economy

It happened in the US from 1979 through 1983.

Obviously, that's not saying it will happen, but that does suggest that it can happen, so it might be an option worth looking at.

(Keep in mind also that you're pushing a bit of a false dichotomy; I was just talking about lack of growth, rather than outright decline.)

What matters is absolute growth not per capita.

Absolutely.  There are two reasons I've been talking about per-capita consumption:

First, my point was really pretty simple:  economic growth without growth in energy consumption is possible - at least theoretically - since historical evidence shows us that a group (e.g., 100M Americans) can have large growth in GDP while having no growth in energy consumption.

Second, demographic trends suggest that this may be achievable in practice.  The West - the world's major energy consumer - has a rapidly-falling population growth rate, and will reach no population growth in the medium term.  What that means is that the challenge of maintaining no overall growth in energy consumption is relatively modest for the West as a whole - about a 0.5% decrease in per-capita consumption per year - and it will get easier as time progresses, since the growth rate will get lower (all other things being equal, which of course they won't be).

I haven't been arguing that it will happen, should happen, or even necessarily can happen; what I've been arguing is that evidence does not support the claim that it can not happen, so more investigation is needed.

Even world per-capita energy consumption is only up 10% in the last 25 years (http://www.eia.doe.gov/pub/international/iealf/tablee1c.xls), despite much faster growth in real per-capita GDP, so it's not as if the increased energy efficiency in the US has (primarily) come at the expense of vastly greater energy use elsewhere.

You also fail to realize that through energy arbitrage, so to speak, our economy's energy consumption has been displaced and "globalized".

No, I addressed that explicitly, as the above quote shows.

during the last 25 years efficiency has rapidly developed, but is starting to hit a wall.

Interesting.  What is your evidence for this?

That it "makes sense" does not mean that it's true.

That even with increased efficiency you still need absolute gains annually (with required population growth) in order for financial markets to function properly. The system just doesn't work otherwise

What is your evidence for this?

The system did work otherwise, from (for example) 1979 to 1983 in the US.  Stock markets even kept going up (although the S&P500 had a crash in 1981/82, it was still higher even at the trough).

In some ways, that illustrates my overall point:  there are variety of "common wisdom" claims that people assert, and those claims typically make quite a lot of sense, but those claims may well be false.

Without evidence - hard, factual evidence - to support a claim, it's very difficult to tell what's true and what's urban myth.

So I'm trying to provide some historical and quantifiable evidence regarding some of these claims, and - having no personal preference for whether these claims turn out to be true or not - I'm pushing the conclusions that the data support.  That is my overall point.

One that took a strong constitution was the uneaten food sorting job in las vegas, that was part of a hog feeding operation.  Apparently there the "extras" from those buffets are recycled.

(in a somewhat tighter economy, someone would have hogs or chickens at home to eat restaurant scraps.  in a very tight (pessimistic future) economy, somebody would eat it.)

(on increasing the food value of those wine grapes, it could be done with dried fruit, fruit leathers, etc ... but the point really is that we don't and that this is a very old choice we have made (in the broadest possible sense of the word "we))

Absolutely true: the 2nd law does limit the efficiency of heat engines, but 1) it doesn't tell you how close you can get to 100%: a very high input temperature and very low output can get you any arbitrary % you want, and 2) as a practical matter you don't have to use heat engines.  For example, fuel cells are more efficient.  Similarly, photoelectric processes can be much more efficient for converting light to electricity than a solar thermal plant using a heat engine, and electric engines are 6 or 7 times as efficient than gasoline ICE's.

In transportation, efficiency is a misnomer: from the point of view of the laws of physics transportation involves "translation" of an object from one location to another.  There is no increase in kinetic energy, no work done, just a change in location.  This can be done with an arbitrarily low amount of energy if something is accelerated to whatever speed is needed, friction is minimized, and the kinetic energy recaptured at the other end (i.e., regenerative braking).  For example, the Prius has, I believe, a coefficient of wind friction of .29, but the GM EV-1 was at .19, and lower is certainly doable.

So, the EV I mentioned with an equivalent MPG of 115 can be doubled to 230 without too much trouble, and can be doubled again with more work.

You're right, cars are somewhat smaller. OTOH, larger SUV's/pickups (light trucks) are more than half the US market, and light vehicles (cars & light trucks) are much more powerful than they were 25 years ago, so on the whole light vehicles are probably at a lower efficiency point design wise, compensated for by more efficient power trains.

There's no question that at some point you run into diminishing returns.  OTOH, there's only so far you need to go.  For instance, an electric car using 50 whrs per mile could be run from PV on it's own surfaces, or even from a bicycle generator - that's personal transportation!

It's true that improvement is limited by turnover. OTOH, turnover is faster than most of the casual analyses have assumed (including Hirsch's, surprisingly), as newer cars are used substantially more than older ones - you can probably replace 60% of car usage in 5 years.

That 20% figure isn't a hard limit: it's what you can do without much trouble.  You could do much more with careful demand management (including use of plugins and EV's for low demand period charging, and V2G), a better national grid, storage, etc.  Solar is complementary: it has a different pattern, and follows usage much more closely than any other source, so between solar and wind you could easily get to 70% of electricity demand.  The other 30% might come from many sources, especially biomass and nuclear.

What's the source of that limit of 300 w/sq meter?  Solar insolation is about 1,000w/sq meter (clear day at a good location).  Sunpower cells (the best single layer cells, i.e., less expensive and not used for concentrating systems) are at 200, the best commercial triple junction cells are at 380, and the latest lab methods offer the possibility of 650.

"please point me to a solar unit where I can get the kind of return (10-30 fold) that you quote."

I think you're thinking of dollar Return on Investment ($-ROI).  Yes, currently solar PV has a very long or nonexistent $-ROI in most places, though it's cost-effective in some places, like Japan and parts of California, and would be cost-effective in many more if the costs of fossil fuels included external costs (pollution, occupational health, CO2, security, etc). PV costs are dropping about 8% per year, and that's likely to accelerate with thinfilm like Nanosolar (though prices may not drop as quickly, as supply is currently being rationed by price due to skyrocketing demand), while FF electricity is rising in price.

Energy ROI is very different, and is quite high for both solar and wind.  E-ROI doesn't tell you anything comprehensive about total cost or $-ROI, it just reassures you that the energy technology in question is basically feasible.

I'm curious where that electric generating capacity chart came from, as the increase from 2000 to 2003 seems a bit steep.  I'd remind you, though, that this is a world chart.  The transition to a service economy would be visible only in places like the US, Canada, Europe, etc.  That's a tough one to analyze at a macro level, as you'd have to account for manufacturing outsourcing, changes in other sectors, etc, but it's pretty clear that a programmer in front of an LCD monitor uses less energy than a guy with a forklift.

Finally, I agree with you that it's not the long-term that's the problem, it's the transition in the next 10-20 years.  I don't have a lot of faith in the Feds, especially with the Current Occupant, but the rest of the world (other countries, as well as local government, private industry, and individuals in the US) is moving.  Let's work so that we move faster.