There are many issues that I feel this way about. One of the side effects of our social stratification is difficulty in having even basic conversations with one another.

I'm glad you're reconsidering your views as well. It's pretty clear that 'racist' starts with a scarlet 'R', meaning people use the label for social punishment: see Mel Gibson, Michael Richards, George Allen, etc. That sort of shaming, punishment, and ostracization makes no sense if we mean they also contribute to a very bad but mostly diffuse oppression.

The reason your first definition of racism is having problems being universal is because the word is used as a form of labeling for the purposes of punishment. It's not generally used as a sort of mutual confession leading toward renewed resolution.

It's a very useful word. "Bob has very discriminating tastes in wine."

Do you discriminate in your hiring practices? Hell yes we descriminate! The only reason we have a hiring/interview process is to discriminate between good and bad candidates.

But by and large it's come to mean only "bad" forms.

But it's only when you look beyond just assuming "oh, they're racist", that this sort of process can begin. And, as linked and explained in the article, there's no guarantee that you actually understand what motivates a person, especially if you haven't tried (or been forced to).

What he didn't mention in this essay is institutional racism, which in his terms must be racism by consequence, because institutions don't have beliefs or motives. At least not in this context. Institutional racism is something that needs addressing, but it's not the same racism by motive, nor should we expect the same solutions to work.