(Picture me saying this in dramatic tones, standing on a podium wearing robes and frequently howling "Fools!")

For a perfect Bayesian, it works. For humans, not so much. Just having a category exist makes us develop silly beliefs around it. If they're categories of people, we start loving our category and hating others - the ingroup/outgroup dichotomy. We treat ourselves as default and other, er, others, increasing the status differential. If a power structure already exists on top on that, forget it. It's really not innocent.