Because I was beat by another post:
Not true! That's only the intrinsic value of a good or service.
There is also the "market value" of a good or service, which is what someone else is willing to give up in exchange for that good or service. Consider that the intrinsic value is essentially static - how many calories a food has, or the mechanical properties of a machine. But the market value can change dramatically depending on sentiment. If I want a new TV, am I willing to sacrifice one vacation a year for it, or two?
My original long post:
The hyperbole is that selling something higher than the labor value to make it is somehow under-paying for labor.
Also if you always pay every cent you have to labor, and don't register it as "profit", then you can never perform "true investment", which is using profits to improve productivity.
By true investment I mean: say you need to farm all year to make enough food for yourself to eat. But you can go with reduced food (income) for a time, so you can use that effort to make a plow, so that next year you can make the amount of food you want with less effort.
So if you just give everyone "all the value of their labor", it makes it very difficult to improve productivity. So we let "employers" have some profit, so they can more effectively use aggregate profit - way more than a single individual can sacrifice themselves - to increase overall society productivity. Sure there's a risk that companies can use that profit poorly.
But it's almost impossible to make a law that would prevent abuse of profit but still allow "good" use of profit. So you either slow down dramatically the pace of innovation, as it can only be accomplished by individuals sacrificing use of present income to develop new stuff, or you allow companies to potentially misuse profit.
If you do have laws about use of profit, though, it should be on the particular use of it - it can't be on something as naive as "10% profit margin is fine, but 11% is too much!"
So the debate really is - should we strive for faster productivity gains, with the risk of abusers? Or should we have slower productivity gains, also with the risk of abusers (because there will be many, many individuals who are happy to just consume every bit of their own produce, never save for famine, and never have any "spare" labor to innovate)?
(Of course, this doesn't even account for other political nonsense like who gets to own what, or taxes, or in-group out-group tribalism...)