Join Date: Jul 2005
Location: Boulder County, CO
Bikes: '79 Gios, '80 Masi, '06 Felt, early '60s Frejus
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Unless you have a dork disk that I can't see, that's rubbing on the cassette, then it looks like the cassette body needs replacement. The freehub is simply not freewheeling the way it should, freely. Oldskoolwrench's advice is spot on except for the chain tangling part. If you don't get it fixed, though, you will get the chain tangling before summer's over.
Unless you're already handy with cone wrenches, I suggest taking to wheel to a shop where they'll dismantle the hub, find a replacement cassette body, and put it all back together.