They shouldn't get to dictate how the web works but then you basically say don't like it don't use Google... I'm confused... are sites able to chose not to use Google? What sites gets most of their traffic from a different search engine?
He's saying that if your visitors are primarily coming from search engines, then your site can ignore what search engines want without harm because being downranked by them won't hurt you. Plenty of sites get most of their visitors from regular readers rather than from search engines.
Sites are able to choose not to use Google, by the way. It just takes a small edit to your robots.txt file to get Google to completely ignore your site.
What happens when those rules begin to stray from principals fewer people agree with? Google is more or less a monopoly.
I don't think google is a monopoly -- there are lots of other search engines who drive reasonable amounts of traffic. But they are certainly the Big Dog. Nonetheless, there is a three-way symbiotic relationship here. If Google pushes so hard that sites stop caring about their google rankings, then Google's relevance will fall. If enough people find Google to suck more than the alternatives, the Google's relevance will fall.