We may have hindsight bias in evaluating something that happened, but to the people that it happened to it was terrifying.
The industrial revolution first attempted to replace our hands. But the labor that was displaced had places to go: into smaller-scale manual work, where mass-production machinery was too expensive, and into knowledge work.
Now the AI is coming for knowledge work, and robots are getting better at small-scale work. We're not at that point yet, but looking down the road I'm not sure there will really be anything competitive left flesh-and-blood humans can offer to an employer.
The only exceptions I can think of are, maybe, athletics, live music performances, and escort services. But with only a few wealthy people as customers, I don't think there will be many job opportunities even in those fields. And I'm not sure that robots won't come for those too.
You're forgetting that work is a means, not an end, for humanity.
In other comments I have expressed support for UBI, as well as for paying parents to stay home and spend time with their children. I think the more automated our society gets, the less people should need to work to earn a living. But I look around and I just don't see anyone implementing such policies.
Nobody had any idea what was coming with the industrial revolution. There wasn't obviously other work for people. And for long periods of time nobody had an answer to that question for large percentage of the population.
In hindsight, we know the answers NOW, but then they did not know what was going to happen. We also don't know what's going to happen, it could go as you hypothesize. Or the Jevon's paradox people might be right and there's way more work to do.
The uncertainty is the historical lesson, not that "it'll all work out"
Yes, two hundred years ago, many people thought reading was a dangerous distraction for young people, just as film, radio, TV and the internet became later. But there is a qualitative difference to having social media in your pocket with vibrating notifications. Pretending its just more of the same honestly feels like slightly willful blindness at this point.
