If you get down to the root of it, those labels are there so Parents don't actually have to watch / listen to / referee the material before allowing their children to see it. Or, they don't watch / listen to the material with their children to be there to provide context and guidance like an Adult.

They're a way to shift responsibility. "Oh this should be okay, it's PG!" is what happened with "Gremlins" and then it scared the shit out of kids. Now we have PG-13 because of that movie. True story.