The governments want to control sex, because it is a productive power.

This is not the kind of sentence that I want to read on LessWrong. I see no reason to argue based on such a vague notion of government that supposedly wants things

Based on what we know about the role of reproduction (and sexuality) in evolution, my priors for "sex is only a big deal because of some historical accident" are pretty low. I would need much stronger evidence than an opinion of Foucault to even consider this possibility seriously.

That said, of course different cultures may have different norms for which sexual behavior is acceptable, and which beliefs about sexual behavior are acceptable.

Knowing about sex is not the loss of innocence. It makes more life. Death should be the loss of innocence. Human culture indeed is centered around keeping life interesting and death far away. Knowing death hurts humans in this culture and knowing sex strengthens. If grownups really want to protect the innocence of children, they would concentrate on eliminating death and celebrating sex and birth.

I am just guessing here, but the thing that removes "innocence" is probably the knowledge of the zero-sum nature of sexual competition.

What I mean is that kids, in order to survive, require a lot of cooperation from adults. In a friendly environment, they can grow up with an ideal of how nice the world would be if just everyone cooperated with everyone else. Of course they know the world is currently not that way (although they way underestimate how much). But it still seems like an attainable goal. Death is a thing that happens to other people (mostly the old ones, which seem like a different species). The bad guys can be defeated, and sometimes even converted to become good guys. The heaven on earth is an open possibility in the future.

And then you learn (in a monogamous society) that when two boys love the same girl, at least one of them is going to lose. Etc. Then you realize, in near mode, that this threat very likely applies to you, and that too many people are potential competitors. The world becomes a battleground.

(Some people go one level meta, and promote polyamory as a solution. Okay, that solves the part with sex, but not the part with reproduction. At some moment of their lives many people decide to have kids, and their preferred partners are usually not willing to have and support unlimited number of kids. Competition again.)

Foucault's theory is like this: the modern Western attitude on sex is heavily corrupted (he had fierce opinions) by the governments that wished to control its subjects.

If China is an example of the "West", what exactly would be the "East" (and "North" and "South") here? Where are the governments that do not wish to control their subjects?

In the 16th century, the Roman Catholic Church called for its followers to confess their sinful desires as well as their actions. The priests encouraged their confessioners to talk endlessly about their particular sexual thoughts.

Yet those people had more kids than most people in developed countries have today.

Something as simple as the contraceptive pill has fundamentally changed human sex and reproduction.

Yet many people would feel jealous if their partner had protected sex with someone else. Human nature does not adapt so quickly. (Sometimes for a good reason. Your partner having protected sex with someone else is sometimes the first step towards having unprotected sex with them.)

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Let me suggest an alternative explanation: I imagine that for an asexual person the behavior of their sexual peers may be confusing, and explanations in style "they are brainwashed" may be tempting because they explain the problem away. It does not mean they are good explanations though.

I remember vaguely Yudkowsky's view on sex, that there is a correct way to be sexual, that the correct way is to get into some kind of traditional, romantic relationship, full of interpersonal emotional connection and intellectual thought, instead of just porn and cute catgirls/catboys.

I am quite confident Eliezer's stance on relationships is to do whatever you want, at least from an ethics standpoint. A "traditional, romantic relationship" is really not what I would expect Eliezer to advocate. 

I notice I am confused. I don't have a good theory of identity, and don't understand why sexuality is any less good a component of identity than anything else.

Reproduction will become a dreary task? Undertaken only with monomaniacal determination or a clear utilitarian gain? Have you ever tried to put a teething child to sleep?..