Talented people want to exercise their talents. The question is what the medium skill range will do. However, the absolute worst approach would of course be to let them all slide into poverty.
Talented people want to exercise their talents and be rewarded for such. They do not want their rewards to be deliberately diluted by an enormous welfare subsidy to the rest of society. Don't forget that individuals can simply pick up their talents and take them somewhere that adequately rewards them for their accomplishments. Siphoning this talent from the rest of the world is a fundamental tenet upon which the USA was founded, and subsequently emerged as the world's only superpower.
"What man has done, man can aspire to do." -- Jerry Pournelle, about space flight
