The identity, 'name', that Daoism finds problematical is that which requires manufacture. Every individual thing in some sense has identity. This pine outside my window has a certain identity; it is not a cedar or that pine over there; it is this pine here. But then, it is only I who imposes the idea of identity upon it; identity is not for it an issue. It is through humanity, by reason of the apparently unique and inherently dualistic phenomenon of self-awareness, that identity enters the world. Adam's first job, after his creation, was to name all the animals; until then, the poor things went about nameless. Without names their being seemed somehow incomplete.
And this, of course, is a projection of our own sense of incompleteness that the manufacture of identity hopes to overcome. It cannot, of course. There is, at our core, a void, an emptiness, which nothing can fill. This is the price of self-awareness which requires a being that is never quite itself. Perhaps all philosophy and religion comes down to this: what to do with this void. Zhuangzi suggests we "find the empty room" at our core and experience its implications for our living generally. For him, it led to an identification with a becoming so thorough as to render a fixed-identity impossible. As such, realizing no-fixed-identity, one is able to wander freely through the environment that arises as one lives; there is no one thing one must be, nor any image of oneself that one need defend.
One reason I speak of philosophical Daoism as distinct from the more religious forms of Daoism which arose subsequent to what might also be called proto-Daoism, is that whereas it explores the implications of the emptiness within as a central and unavoidable given of our existence, religious forms attempt to in some way fill it. Buddhism, too, begins here with emptiness and void, but consistent with the propensity of humanity to flee from its implications, popular, religious Buddhism attempts to fill it.
The manufacture of name, of a self-image, of a 'someone' I am, is the attempt to fill the emptiness on an individual level. For this reason, the texts of Daoism identify the pursuit of name as counterproductive to authenticity. The sage "has no name" because, despite having a name and a reputation, they are not a source of her identity; whatever her sense of identity may be, it is fluid and "peculiarly" unfixed.
Without name, what is there to defend? How could one be offended? Who would there be to feel shame? Why would one need to assign blame?
Zhuangzi understands the emptiness within not as an indictment and negation of the experience of existence, but rather as an opportunity to experience it more fully. It is an invitation. Emptiness is the gateway to fullness. If we lose ourselves there, we discover the fullness that arises from the limitlessness and boundary-less-ness of no-fixed-identity. This is a fullness unfilled. This is the view from Dao.
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