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Well, I guess first I would say that "judgment" and "justice" are not the same thing. Judgment is sometimes the application of justice, and sometimes a miscarriage of justice. In the context in which James made that statement (Jam. 2:13), he was referring to unrighteous judgments (cf. Jam. 2:4). His point was that his readers would be cursed if they continued to render unrighteous judgments, but blessed if they began to show mercy instead (giving the good seats to the poor, etc.). In the cases James addressed, mercy was righteous justice, and judgment was injustice.

But your general question is a good one: Why does God allow so many people to perish and show mercy to so few, relatively speaking? I don't know why he has chosen to save such a small percentage. I think it is safe to say that it is his good pleasure to save precisely whom he saves and to condemn precisely whom he condemns. But it seems to me that Scripture does not tell us why it pleases him to save so few and to condemn so many. It does explain that it brings him and us glory, but it does not tell us the precise reasoning behind this conclusion.