Resource inequality and thus wealth inequality is rather bad because one person is generally unable to allocate resources efficiently after a certain point of excess. Resource inequality leads to inefficient resource allocation.
In general, markets can only work when people are averse to the loss of money, thereby introducing a feedback mechanism. And people are only averse to the loss of money when that has material consequences for their well-being. For the ultra-wealthy today, the marginal value of every additional dollar (or million dollars) is essentially zero, so the self-balancing properties of markets are prevented from doing their job properly, namely the efficient allocation of resources.
Also...
The idea that wealth hoarding inherently leads to inequality is flawed. If by “wealth” you mean capital, then unused capital doesn't distort markets or hinder wealth creation. If you're referring to wealth hoarding in the form of monopolies, it's important to note that monopolies tend to fail in truly free markets. Without innovation, they can't sustain themselves—unless they rely on government coercion to maintain control.
Government coercion is the primary force that inhibits both wealth creation and healthy competition. Overregulated markets and protectionist policies stifle innovation and prevent new players from entering the market. The most corrupt governments and corporations benefit from these systems because they reinforce existing power structures and shield them from competition.
That is also the stance of the capitalists. Have you heard of welfare? Now, have you heard about a successful capitalist society without some form of welfare?
1. "truly free markets" don't and can't exist.
In the absence of a strong government to create rules, companies and individuals will fill the power vacuum (e.g. the east India company). "free markets" are just as much of a fantasy as "Communist utopia".
2. Redistribution is less inefficient than the alternative
Without sufficiently redistributave policy, the alternatives arise. The French revolution and various communist revolutions throughout the world over the 20th century are the alternative to a populace that thinks inequality is too high.
Why don't we follow evolutionary laws and let nature and competition tackle resource allocation?
We don't do that because we don't like seeing women and children get their brains beaten out with a large rock over a rabbit haunch that the bigger ape wanted.
As soon as you add social organization, you disrupt evolution inside that social unit: it then becomes one social unit vs others…. We’ve already been down that road, and now we live in large, relatively stable social units we call nations.
Anything inside a social unit is subject to the monopoly of coercion that the unit possesses over its members. Evolution is short-circuited by the presence of external existential forces.
Making evolution work inside a social unit is equivalent to dissolving it.