Yes that is how difficulty works, of course miners will drop out and the total hash rate of the network will probably go down, but my point is -33% block reward is not necessarily the same as -33% hash power.
When the Byzantium upgrade hit in Oct 2017 the block reward went from 5 to 3, -40%, [and the total hash rate barely stagnated for just a couple weeks,](https://etherscan.io/chart/hashrate) so nobody really knows how it will shake out.
With Byzantium the difficulty bomb was in effect, so while the block reward went down the frequency of blocks went up enough that total issuance actually went up slightly. Right now the difficulty bomb is not impacting blocks, so the total issuance rate will drop.
During Oct 2017, the fiat value of the coin also skyrocketed, so mining was still immensely profitable even with reduced block rewards.
The opposite is true today - many mine at a loss hoping that a future boom will save their investments.
Oct 1st it was $300, Oct 31st it was $310 - I wouldn't call a 3% increase skyrocketing at that point, and those values are much closer to today's price than the ATH, so the profitability is not very far removed.
Pointing out that miners will still mine at a loss while hoping for the price to go up further substantiates my point that you can't go around making predictions about the effect Constantinople will have on the total network hash power as if it's a fact
It could be useful to draw more data from the two bitcoin halvenings to learn the impact of fiddling with the block rewards. I like the theory that it removes slack in the market, so while you don't get an instant jump in price, it tightens the marginal sensitivity to increased demand. So when the next demand arrives, the price can really zoom up fast. Of course, if the demand doesn't arise, it doesn't matter how low the rewards go, with respect to price.
I think it's also worth noting that, if there were no hard fork, the difficulty bomb would start reducing issuance in the future. It would stay 3 ETH / block, but the difficulty bomb would mean less frequent blocks, so the issuance over time would start to drop.
The difficulty bomb is there to make forks easier. The increasing block time starts to cause network congestion, making *not* forking untenable. At the very least it becomes necessary to fork to reset the difficulty bomb, and at that point it becomes easier to agree on other changes (or at least that's the idea).
That's true, but it's important to consider when looking at an issuance reduction. If we reset the difficulty bomb without an issuance reduction, it effectively increases the inflation rate over a period of time.
It's a block reward reduction not an issuance reduction. Issuance is stabilized. If you look at the chart in the linked article, you see, after the Byzantium hardfork, where the reward was reduced to 3ETH, the issuance actually went up.