...for agreeing to stay out of this thread any further, since the label-haters add nothing productive to this discussion at all, they all parrot the exact same single point over and over again, and as I said, I already pre-rebutted your stance.
But I'll answer your question anyway for the benefit of those who may be "on the fence" about the issue. Why are certain labels needed? Because they are useful in forming an identity to rally around, develop pride and acknowledgement of their attraction base, and to celebrate the concept of diversity as opposed to the denial of it. Yes, labels have been used destructively, but they can also be used positively. 'Nuff said.