I don't buy everything RMS says, but I really think this is a misrepresentation:
RMS has a perverted idea of freedom. Not only does he force people who use GPL'ed code to contribute back in the name of "freedom"...
So, who's forcing you to develop GPL'd code? No, it's people who build on GPL'd code and then distribute it. In other words, what he's saying is that you cannot build a proprietary product on GPL'd code.
I don't think that's any more outlandish a demand than, say, Apple's licensing requiring that certain pieces of Apple software specifically should not be used to make nuclear weapons. Or, for that matter, Microsoft demanding that if you want to even execute most of their software, you have to pay them.
I prefer BSD-licensed code when I can get it, and I tend to release BSD-licensed stuff myself when I can, but that doesn't mean that anyone is "forcing" me to do anything with GPL'd code.
but he assigns freedom to the code itself which is an inanimate object.... I have no problem with someone requiring effort in as "payment" in lieu of money but just don't be a hypocrite and claim that it is somehow more "freedom" than writing someone a check for a reasonable fee.
I suppose you could interpret "Software Libre" that way, but this is about the freedom that you as a user and developer have with such software. In particular, you're generally free to do anything you want with Free Software other than distribute a proprietary derivative. You can take GPL'd programs and invoke them from a proprietary program, so long as you obey the GPL wrt. the actual GPL'd programs you're using. You can even develop a proprietary derivative and not distribute it, as Google does with Linux internally. For that matter, you can sell it for a price and only distribute the source to your actual customers.
That's what he's talking about. Not the freedom of the code itself, but of future users and developers.
Now, if your problem is that it limits the freedom of developers as well -- for example, it limits my freedom to build a proprietary product under a different license while including GPL'd code -- then you're right. For what it's worth, BSD-licensed code is also considered Free Software, and it has almost no restrictions on its use. Hell, public-domain code, like sqlite, is also Free Software.
But think about what we mean when we talk about freedom in other contexts. We have freedom of speech in the US, but there are many well-documented limitations to that at pretty much every level. Certain kinds of speech -- "Fire!" in a crowded theater, false advertising or outright fraud... I don't think we would take these to mean that freedom of speech does not exist in this country, or that it's hypocritical of us to criticize the kind of censorship that China engages in, simply because we don't have absolute freedom of speech. Similarly, I don't think it's hypocritical to criticize proprietary software as being "non-Free" just because GPL'd software has some limitations.
For what it's worth, I don't generally use the terms Free Software, and while I prefer open source, I'll use proprietary software when it makes sense. I'm not a zealot. (Honest!) But the idea itself isn't inconsistent or hypocritical, and it does have some merit. It's just difficult to achieve in the real world.