In my experience there are a lot of people working who would make industry more efficient if they could just freeload instead of faking it.

>Ok, fine, but if taxes get high enough, along with the benefits, you can expect some people to stop caring and start becoming freeloaders themselves.

Some people yes. Good riddance from productivity to them.

The people with actual internal motivation would do inventions, great work, art, programming, etc, even if they're not getting mega-rich from it.

It might slow the speed of mega-corps and new gadgets every month, but perhaps that's just what the doctor ordered. More quality, less greedy obsolescence, longer term products, more personal vision (as opposed quick-buck-schemes).

People are already starting to do this, in a time of immense economic prosperity. Look around at the "able-homeless" in the SF bay area.

That's self-limiting, because if that happens, it drives inflation, which drives the real benefit levels down at the same nominal benefit level, which makes fewer people feel like they can afford to opt out. As long as benefits are tied to revenues rather than inflation-indexed, negative feedback market forces limit opt-outs.