I think it is necessary to remember that all people make mistakes and that doesn't make us bad, it makes us human. All in all there is a lot of sickness in the world and when I say sickness I don't just mean physical sickness, but psychological as well. People can rationalize anything and sometimes people can do really cruel things and convince themselves that that is o.k.
Some judging is a part of life and is not bad. It is essential to be able to make decisions like who makes a good friend and who doesn't based on their behaviors, I don't think that's bad. But I do think it is unkind to go around criticizing everyone for the mistakes they make.
It is a good skill to recognize the difference between right and wrong but it is the most productive in us when we are able to turn that knowledge on ourselves in order to achieve a certain level of self-examination and self-awareness.