The date can be pushed back much farther if more costly (or maybe some to-be-discovered improved) technology is used. As for the estimates of cost, by reasonable standards one could argue that oil is far under-priced. In real terms, it's not particularly high now as compared with other commodities, from some reasonable base line. And low-priced oil leads to heavier use and less effort to create sustainable alternatives.
That I think is a far more serious problem than production peaking. In fact, one could argue that the earlier production peaks, the better off the human species (and a lot more) is, because of the effects of unconstrained use of hydrocarbons on the environment.
Talk about "shrinking our economies" is pretty meaningless. Our economies would shrink substantially if we got rid of huge expenditures for the military, for incarceration, and other highly destructive activities. Sustainable economies might lead to highly improved quality of life.