I don't disagree with the point you're making, but I should point out that one reason some funds don't beat the S&P500 is because of the fees they charge, which

I don't disagree with the point you're making, but I should point out that one reason some funds don't beat the S&P500 is because of the fees they charge, which are deducted from their performance. In reality, their actual gross performance is better than the S&P. However, the fact that the results are so close to the S&P's performance that the fees alone can push them below it supports your overarching point.