Why won't it make transactions prohibitively expensive? Each transaction needs a trustless agreement of many, many nodes.
The halving penalty on work just forces attackers (who have +1 routing hop compared to honest nodes) to double the work of those honest nodes if they wish to outcompete them in producing a longer chain (i.e. no 51% attack).
It also allows users to respond to attacks in real-time by affixing harder proofs to their transactions, increasing the attack-cost on the network in minutes should anyone try to pull off the sort of gambit described in the linked page.