I guess airlines have to have a policy .. otherwise a person checking in a bag on the cheapest possible coach ticket with 26 multi airline "express" and "priority" type tags wil get his bag faster many times than the guy paying $7,000 in First with his one miserable "bruised" tag!
I just posted an amazing deal on the CO chat site here. Australia to USA return for $US365. (Wish United matched THAT one!) I asked CO what a First ticket cost on same route .. answer $US5,115.00 ONE WAY!
Re tags coming off, try checking in your bag 10,000 miles away from end destination, with 3 or 4 or often more on-line transfers, which I mostly do, and see how many orange paper tags stay on! As I said, plastic has gotta be the simple answer.