This is correct. The cheaper something becomes, the more there tends to be of that thing. The main effect of AI on bureaucracies and your relation to them is that instead of having 40 pages of paperwork to do, you’ll have 4,000. The AI will fill it all in but you’ll still have to review and correct it all.
And if you think this is not what’s gonna happen…well, prepare to be wrong. It is inevitable.