Great piece by Rich Trouton exploring the details of how iCloud Desktop and Document syncing works. He makes a good point here:
Currently, Apple provides 5 GB of storage space for free for
iCloud users. That 5 GB of storage includes storage for your
iCloud email, your iCloud backups for your iOS device(s), your
iCloud Photo library and iCloud Drive. If you need more than 5GBs
of storage space, you have to pay for it.
Considering that most folks likely have more than 5 GB of files
stored in their home folder’s Documents directory, let alone their
Desktop folder, there are immediate issues with enabling iCloud
Desktop and Documents syncing if you’re not paying Apple for
sufficient iCloud storage space.
It’s easy for me to say that Apple should give all iCloud users a lot more free storage, and I know that the company is on a “We make money from services” kick this year. But they’re the ones who keep adding new features to iCloud that require significantly more storage space.