We're rather short of full employment right now. Unemployment levels are still close to 8%, and there are currently a lot fewer job openings than there are people seeking employment. I've heard some economists contend that it's in part due to the fact that we're actually reaching a point where there are fewer "burger flipping jobs" available than there are people trying to fill them. Not everyone can be a programmer.
Even if they're mistaken, and that isn't yet the case, if the proportion of jobs that need a human to fill them decreases enough, we'd be bound to reach it eventually.
And even if we take your thought experiment at face value, and assume that all production is outsourced to machines, then you basically suggest that nobody has to work in order to have stuff. Why would people be poor in that situation? The biggest threat would be hedonistic ennui, the self-destructive spiral of boredom and addiction that seems to afflict the vast majority of any group that doesn't have to work(be it nobility or people on welfare). But you'd never have to worry about a roof over your head.
Due to increased mechanization, we're producing multiple times more wealth now than we were a hundred years ago. Why should anyone be poor now? The system we have isn't designed to provide much compensation for people whose productivity is low. It could be, and if it isn't eventually it's liable to become a rather large problem.
I never said that this would result in most of the population having no wealth; it's certainly not a historical inevitability. But our production levels have already come a long way in the past several decades with most of the gains being concentrated in a small proportion of the population.
In the extreme case where almost nobody is producing anything, but some people retain ownership of the means of production, it's obvious that society isn't better off if the median citizen isn't compensated beyond their level of productivity. But we don't necessarily have to reach that extreme before we reach a point where society as a whole is better off if the median individual is compensated beyond their level of productivity.
Economic cycles exist, and we're at a bit of a bad point in them right now. I don't buy the thesis that this is somehow permanent, though - there's always been a cottage market in talking about how This Time Is Different, whether on the upswing or the downswing, and it hasn't been right yet. Even if the total amount of labour needed to run a modern society is dropping, that can just as easily be absorbed into shorter work hours instead of unemployment.
Also, by the standards of a hundred years ago, almost nobody(in the developed world) is poor today. The ...
We have a tradition of treating ruthlessness in businesspeople as something of a virtue. Certainly, ruthlessness can help one get ahead in the business world, and companies often benefit from executives who're willing to put aside scruples while devising means of turning a profit. So ruthlessness in business executives can certainly be useful for businesses.
From a societal perspective though, businesses are only valuable to the extent that they increase the wealth and quality of life of society as a whole. Businesses are allowed (indeed, required, in the case of publicly traded companies) to attempt to maximize profits, on the presumption that in doing so, they'll enrich the broader society in which they operate. But there are plenty of ways in which businesses can increase their own profits without becoming more wealth productive, such as cooperating with competitors or establishing monopolies in order to keep prices artificially elevated, use of advertising to promote a product or service relative to equal or superior competitors, lobbying with politicians to slant the legal playing field in their own favor, and so forth.
I have reasons to expect myself to be somewhat biased on this issue, so I'm not sure how telling it is that I personally come up short of any examples of ruthlessness in business executives being useful from a societal perspective, when compared to business executives who're highly competitive, but compassionate, with restrictive senses of fair play. So does anyone else have examples of ruthlessness in businesspeople as a social virtue?