God is magnificently redemptive. None of us would have any hope if that were not the case. Yet we must not confuse His redemption for His approval. Gods redemptive grace is not His approval of spiritual dysfunction. Many people are abiding in or gather in dysfunction, this is not the kingdom Jesus died for. Our redemption includes the healing/reconfiguration of Adamic brokenness, not the normalization of it “under grace.”
God’s great redemptive goodness in the presence of dysfunction does not invalidate His norms. Neither does our redeemed dysfunction establish new norms.
Pat religious clichés like “God blesses our mess,” “no one is perfect,” “there is no such thing as a perfect church,” “we’re all sinners saved by grace,” etc. may have germs of truth in them. However, they and others like them are routinely used to justify the perpetuation of individual, interpersonal, corporate body, and systemic dysfunction under the guise of being kind, merciful, or gracious.
Alas, if anyone should dare to address perpetual dysfunction, those who control ecclesiastical power (and the insecure) will accuse him/her of being judgmental. Being allegedly “judgmental” is the unpardonable sin of our generation, both in our culture and the ekklesia.
As I relate to leaders around the world, I witness (on a widespread and regular basis) the excusing of the foulest sin in the body of Christ by the wave of the magic wand of being “judgmental or religious.” It has reached the point for most Christians that “judge not” means: turn off all faculties of discernment between good and evil, light and darkness, life and death. Any evaluation of a doctrine, practice, or behavior is considered being unduly “critical” or “judgmental”—allegedly something Christians are not supposed to do, based on proof texting Matthew 7:1 and spraying it on everything that moves and breathes! The same Lord who admonishes not to judge in Matthew, encourages us to judge in John 7:24!
So, what is the difference between prohibited judgments and encouraged judgments? We need to unpack this a bit!
I am a new covenant, radical, “hyper” grace of God sort of person in every way: theologically, practically, spiritually, and subjectively. In fact, I am often criticized for being just that! However, the grace that is really God’s grace is both empowering and instructive. Someone who is experiencing God’s grace in the power of the resurrection life of the Lord Jesus Christ, will be empowered to stop ungodliness. They will not habitually practice sin absent of conviction. 
The Jesus we have created in our cultural, conservative, “Christian” religion is an idolatrous figment of religiously sentimental minds. However, that Jesus is a necessity to keep the church growing and the finances flowing. Often an unsanctified mercy gift or an over-expressed pastoral gift (defined by cultural values of success and what it means to be a “good pastor”) facilitates the “don’t judge” spirit. The lack of the expression of other equally valuable gifts and graces results in a very warped and utterly unbiblical expression of the pastoral grace.
Of course, propping up the “judge not” cultural virtue with a proof text cannot withstand close biblical scrutiny. For example:
Jesus was “judgmental” when He:
- Insulted people – Matthew 12:34 et. al. 
- Called them names – John 8:44
- Threatened them – Luke 13:3
- Whipped them – John 2:15
Paul was “judgmental” when he:
- Threatened people with curses – 1 Cor. 16:22 ; Gal. 1:8-9
- Confronted their hypocrisy, judging their behavior – Gal 2:13-14
- Committed them to divine discipline – 1 Tim. 1:20; 1 Cor. 5:5
The Context of Matthew 7:1
The context of Matthew 7 is hypocrisy, not evaluation between good and evil. Jesus is dealing with those who want to “speak from behind the mask,” those who present themselves as something other than what they are, and measure and condemn others for the same sins they secretly engage in word, thought, or deed. Discernment is not being prohibited in Matthew 7.
Assuming we can agree that being conformed to the image of Jesus Christ is the divine purpose for all humanity,  we cannot go wrong being like Jesus. The judgment we are to engage is the kind the Messiah engaged in. He did not judge by what He saw with the eyes and ears. He looked beyond the surface. He confronted concentrations of power in all forms: religious, political, institutional, financial, spiritual, and based His judgments on behalf of the poor. 
The judgments we are prohibited from engaging in are those that are inconsistent with the Scriptures and His Spirit. We are forbidden from condemnation (of ourselves and others!): the issuance of a final decree on a matter, a judicial “sentence” of finality. There is only One who is qualified to make those kinds of judgments, because only He knows the hearts of humanity fully. We cannot know the depth, breadth, and scope of His redemption concerning others. We see through a glass darkly.
If all judgment/discernment is prohibited by the Lord, then the general discernment belonging to all believers (as sharing in the Spirit of Christ) and the specific gift of discerning of spirits, are both unnecessary—there is nothing to judge. I suggest that many of the problems experienced in individual lives, relationships, and in local faith communities result from precisely this failure to exercise the most basic elements of discernment: a failure to righteously judge.
Not All Judgments Are Negative!
In our culture the word “judgment” has such a negative connotation, it is hard for us to understand that it is possible to make positive judgments! Acquitted! Son not slave! Free! Forgiven! These, and many others, are all positive judgments!
We are to make evaluative judgments from the new creation nature, based on the Scriptures and the Spirit of God. Our evaluations are to be full of grace and truth: truthfully gracious and graciously truthful, and severe when necessary , remembering our frames are but dust. We must always remember the mire we have been rescued from, and extend the same long-suffering graciousness to others. The measure with which we measure others, we will be measured by. Our judgment is in hope, and in mercy triumphing, not rejoicing in another’s weakness or failure.
Never the less, judge (discern/evaluate) we must . . . starting with our own hearts and the beams in our own eyes. And then, in a culture of love, safety, and trust (three VERY RARE commodities in theekklesia), our “judgment” broadens. If we do not understand this, we will normalize dysfunction and think God’s blessing is residing on us for it.
“Dysfunction Junction” – Has No Unction!
Gods Redemptive Grace is not His Approval of Spiritual Dysfunction
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 Titus 2:11-15
 1 John 3:9
 Semitic people believed that snakes reproduced asexually, without a father. To call someone the “children of snakes,” was the same in our culture as calling someone a bastard: fatherless. There was no greater insult possible toward a Jewish person. Their entire identity and “place in God” depended on their tracing fatherhood to Abraham and ultimately, God through Adam.
 And pronounce a grace-based blessing in the same verse!
 2 Cor. 3:18; 2 Cor. 4:11