Well, I always say that labels are tools. In the system we have, sometimes labels help to get necessary services. Like any tool, sometimes labels are misused and can cause damage instead of bringing assistance. But used correctly, labels are very useful.
If it weren't for the label "gifted" I doubt any of us on this forum would have found one another here in cyberspace. So there's an example of a good use of the label, one that's near and dear to my heart!

In an ideal world, all kids would be taught what they were ready for, would be challenged appropriately, would have their weaknesses nurtured, would have their educational needs met...all without labels. But sadly, this ain't that world.
