I do hold some eugenic views, but I don't take them that far. It's a lot better to reduce the numbers of "useless feeders" by preventing them from being born in the first place, which would attend to itself given legalized abortion and proper market incentives (see also "
Libertarian Sexual Morality" thread). Every child that is at least 50% human (in the scenario of human/animal hybrids) should get the "Right to Life" from the point of physical autonomy (i.e. birth), but the Rights to Liberty or Property must, for obvious reasons, wait until s\he can be expected to act rationally.
I've written extensively in the past about the emancipation of minors to change the concept of "minimum age" laws (and facilitate adoption of children from unfit parents), but I still envisioned everyone getting automatically emancipated at a certain age (ex 18). Perhaps some kind of a legal mechanism could be used to temporarily or permanently challenge automatic emancipation on the grounds of mental incapacity, in which case the parents or guardians of the child would be able to keep guardianship status indefinitely, or pass it to someone else.
Some organizations (for profit or not) might have certain requirements in exchange for accepting guardianship of that person, such as the right to encourage work (in exchange for rewards or avoidance of punishments). Such organizations can in theory be cruel, but since they're privately funded they have to earn their donations and the trust of the parents / guardians, and that market would self-regulate.
So in a purely capitalist system, "retards" would be very valuable members of the community, taking on jobs that most people would not (and robots would be unfit for). A retard would make a great sparring partner for martial arts, for example. Rich people can hire them to dress up in funny costumes and entertain their guests by falling from high places. And then there's the lucrative market for "cruelty free" cosmetics that, in keeping with their label, are not tested on animals. Etc. The possibilities are endless!