First, the main characteristic that makes Bitcoin censorship resistant is not fees. It is it’s flat decentralized architecture, imo. Fees play a part but it is not the only characteristic that contributes to censorship resistance. This security budget stuff is not a compelling argument for me, even in your rendition of it.

So, your argument is that governments can spend infinite amounts of perpetually and exponentially devaluing fiat currency to control hash power? Sounds like what the US empire is doing now to hold on to their empire, it is doomed to fail.

I don’t disagree that they can and will try. They could possibly succeed for a bit. That is usually their move, throw paper money at the problem. Good luck to them, they cannot keep it up for long.

The states trying to spend to control hash power are only digging their own graves faster. They will have to print more and more to maintain majority hash power in perpetuity, devaluing their fiat currency, and the amount they will have to print increases exponentially.

This is why I say it is not possible for states to co-opt and control Bitcoin by printing money to spend on hash power. They would have to attack it some other way.