Why is there even a charge?

Many people are hogs. And some people are the ooposite - flying light for business, and a one-night turnaround - or same day home - so NO luggage. The HOGS bring enormous bags - and skis, bikes, surfboards, ;large animals. And to beat the fees, they also try to come on board with HUGE pieces, that would never fit in thier fairly-alloted space overhead - and NO WAY under the seat. I saw a BIG guy plow past the gate agent, with a 30 inch bag - the burly gate agent followed him, as the first jerk was pushing down the aisle yelling "I AM NOT LISTENING TO YOU!!!!" No more than two minutes later, the agent walked aback out of the plane . . .carrying this guys huge bag with one hand, OVER HIS HEAD, like it was a file folder.

We NEVER EVER pay a fee for our bags. we are Delta members, and carry a Delta AMEX Platinum card - and always fly first class. Boom. Done.

Why? Because airlines have figured out that it's another way to make money and their research has shown customers prefer this as opposed to higher airfares.

Because of the increased overhead cost of operating the airline, a number of them have stopped subsidizing the cost at the handling and transport of checked baggage. (Not all airlines have done this. Southwest Airlines still allows for 2 pieces of checked baggage at no cost thanks to their partial hedge at controlling their fuel cost and operating on a single type of aircraft.)

Eventually, certain airlines (mostly legacy carriers) will start charging for carry-on baggage.

There's a charge because airlines figured out a way to increase their profits. In my opinion, it was a bad idea because it resulted in everyone dragging their luggage on the plane and standing in the aisle trying to stuff it all into the overhead compartment. This sometimes causes planes to be late leaving. But airline profits are way up, and they're unlikely to go back to giving anything for free. Some are now charging for carry-on bags, too.

There's a charge so the airlines can make more money. They used to not charge for checked bags. In theory, if you travel light and don't check bags it would be cheaper for you than people who use that service but for some trips it isn't really feasible to just go with carry on especially with the limitations on that these days.

Basically airlines like to display the cheapest possible fare on travel sites, which most people use for airline bookings. Creating an additional charge for checking luggage allows airlines to offer a cheaper base fare, and this makes it more likely that you'll pick their flight on priceline or whatever.

Money of course- the airlines want all the Money they can get from passengers

that is the Free enterprise way

The airlines created this problem out of greed.
They said out was due to rising coats of operations and they didnt want to raise fares but they did anyways

The purpose of the seats is to sit on, and they charge you for that.

Why is there even a charge for checked luggage?

Isn't that what the luggage compartment is for or am I missing something?
In the past passengers paid a price that included not only the seat but things like luggage, a pillow,maybe a blanket, some beverages a meal and other stuff.
Some demanded a cheaper price. The Airline response was to divide up the price and charge for each individual item.
The seat is one price and luggage is more. SOME do not need to take luggage so they get a better. fare.
The Airlines uses any empty space to haul cargo. For example the Mail.
At one time you paid much more for your ticket and it came with many extras for no additional charge.
Bargain hunters did not want to pay for what they did not use. The result the current a la carte pricing of your ticket and travel price.
Some in the past abused the luggage allotment with very heavy and very large bags. Overtime limits needed to made in both size and weight of each individual piece of luggage.
It was common to have bags of 80 pounds and more for international flights. Many baggage handlers injured lifting them onto planes. Largest one I saw was 300 pounds. The passengers name and situation was recorded and this item for all future flights was to be sent only as Cargo. He claimed it was luggage as he had a change of clothes in it and his other stuff a portable office.

Each pound of stuff be it the Passenger, a meal, some luggage costs money to haul from place to place.
NO ONE likes to pay for others stuff.