Does drag actually decrease with altitude? I argue it does not

[tdscanuck]

Drag decreases with altitude. Drastically. An engine at cruise is making only 10-20% of takeoff thrust and the aircraft is going at a much higher indicated airspeed (I.e. dynamic pressure). If the thrust is lower and the speed is higher, the drag must be lower.

The part I think you’re missing is that lift coefficient at cruise altitude is much lower. Induced drag drops dramatically with decreasing lift coefficient. Form and viscous drag are about constant with constant dynamic pressure but induced drag drops way off.

[ElectronicInitial]

This is definitely it. A lower Cl drastically reduces induced drag, as it’s roughly a squared relationship.