If labels were so abusive artists wouldn't use them. It's not like setting up a label is hard.

The reason labels have such high overheads is the same as for movie studios . They subsidise a lot of non-Taylor Swifts music that don't end up being profitable. The costs of the failures end up impacting the profits of the successes. The flip side is - lots of artists get studio time and songwriting time even if they haven't already proven themselves.