The labeling program provides a signal to consumers that the device meets a certain standard. The incentive to the manufacturer is that it allows them to borrow the FCC's reputation and advertise a security that is well defined. The consumer can see that the device has that certification, and know that product has legal obligations, and

It's a pretty reasonable first step. No manufacturer is being punished, there's no warranty requirement, and the gov isn't taking away choice. Instead the FCC gives manufacturers a way to reliably signal to consumers that their product meets a security standard. Google can do that because they're Google and have a reputation - this approach would let joe-schmo IOT device manufacturer do the same.