Rav Menachem Mendel of LInsk zy”a (Sefer Likutei Maharam) explains that the pasuk is coming to teach us the importance of not speaking lashon hara about any Jew. Every Yid is called “kodesh”, as is stated (Yirmiyahu 2:3): “Yisroel is kodesh to Hashem.” Thus, the pasuk can be read as saying one must “separate himself from the holy children of Yisroel” by refraining from speaking badly about them.
The Divrei Yisroel of Modzhitz zy”a discerns the same idea from the later pasuk (22:9): “They shall keep My mishmeres (protected thing) and they shall not bear a sin on it.” What is Hashem’s mishmeres? This is a reference to Klal Yisroel, as the pasuk says that Hashem is their guardian (Tehillim 121:4), which means that Klal Yisroel is His “protected thing”. Thus, the pasuk can be read as saying that one should be careful with Yidden and make sure not to speak badly about them because they are protected by Hashem.
The Rebbe of Kuzhmir zy”a says that when a Jew speaks well of his friend, not only does he benefit in the next world, he also benefits and is granted a tikkun in this world. By doing this, one weakens the prosecuting forces more than Heavenly angels and thousands of neshamos of tzadikim can do in Gan Eden.
The opposite is also true. If a person speaks badly of his friend in this world, he causes tremendous problems in the Upper Worlds. Therefore, one should always look at his own failings so that he can see others in a positive light and see their good qualities in comparison to oneself. For this reason, when tzadikim would see simple Jews in the streets wearing tzitzis, they would run and hug them.
In this vein, Rav Boruch of Mezhibuzh zy”a would say, “When I look at the world, no one appeals to me. But when I look at myself, the rest of the world looks good.”
