If you want me to take your proposal seriously, you need to justify why 60% full is a good answer

Sure thing Gavin.

If you want blocks to be at least 60% full...

First off, I do not want blocks to be at least 60% full, so let me try and explain where I got this number from

• The idea of this parameter is set a triggering level for an increase in the block size 
• The triggering level is the point where a reasonable medium-term trend can be observed. That trend is an increase in the transaction volume that, left unchecked, would fill up blocks.
• Determining the appropriate triggering level is difficult, and it consists of 3 parameters:
1. Evaluation period
• Period of time where you check to see if the conditions to trigger a raise the block size are true 
• Ideally you want an increase to occur in response to a real increase of transaction volume from the market, and not some short term spam attack.
• Too short, spam attacks can be used to trigger multiple increases (at least early on). Too long, the block size doesn't increase fast enough to transaction demand.
• I selected a period of 4032 blocks
  
2. Capacity
• The capacity level that a majority of blocks would demonstrate in order to trigger a block size increase
• The capacity level, in tandem with the evaluation period and threshold level, needs to reflect an underlying trend towards filling blocks.
• If the capacity level is too low, block size increases can be triggered prematurely. If the capacity level is too high, the network could be unnecessarily jammed with the transactions before an increase can kick in.
• I selected a capacity level of 60%.
3. Threshold
• The number of blocks during the evaluation period that are above the capacity level in order to trigger a block size increase.
• If blocks are getting larger than 60% over a 4032 block period, how many reflect a market-driven increase transaction volume?
• If the threshold is too low, increases could be triggered artificially or prematurely. If the threshold is too high, the easier it gets for 1-2 mining pools to prevent any increases in the block size or the block size doesn't respond fast enough to a real increase in transaction volume.
• I selected a threshold of 2000 blocks or ~50%.
• So in my proposal, if 2000+ nodes have a block size >= 60%, this is an indication that real transaction volume has increased and we're approaching a time where block could be filled to capacity without an increase. The block size increase, 10%, is triggered.

A centralized decision, presumably by Satoshi, was made on the parameters that alter the target difficulty, rather than attempt to forecast hash rates based on his CPU power. He allowed the system to scale to a level where real market demand would take it. I believe the same approach should be replicated for the block size. The trick of course is settling on the right variables. I hope this proposal is a good way to do that.

Some additional calculations 

Block sizes for each year are theoretical maximums if ALL trigger points are activated in my proposal (unlikely, but anyway).

These calculations assume zero transactions are taken off-chain by third party processors or the LN, and no efficiency improvements.

• 2015
• 1 MB/block
• 2 tps (conservative factor, also carried on below)
• 0.17 million tx/day
• 2016
• 3.45 MB/block
• 7 tps
• 0.6 million tx/day 
• 2017
• 12 MB/block
• 24 tps
• 2 million tx/day 
• 2018
• 41 MB/block
• 82 tps
• 7 million tx/day
• 2019
• 142 MB/block
• 284 tps
• 25 million tx/day
• 2020
• 490 MB/block
• 980 tps
• 85 million tx/day

By way of comparison, Alipay (payment processor for the Alibaba Group's ecosystem) processes 30 million escrow transactions per day. This gives us at least 4-5 years to reach the present day transaction processing capacity of 1 corporation... in reality it will take a little longer as I doubt all block size triggers will be activated. This also gives us at least 4-5 years to develop efficiency improvements within the protocol, develop the LN to take many of these transactions off-chain, and network infrastructure to be significantly improved (and anything else this ecosystem can come up with).

(let me know if any of these calculations are off)