Now that I am older, I believe that is the proper

Now that I am older, I believe that is the proper standard by which to judge people.
请详细分析一下that在此作什么用，还有为什么要用by which to,十分感谢。

I believe (that) that is the proper standard......
第一个that为宾语从句的连接代词，已省略，第二个为从句中的主语，that为指示代词，相当于一个名词

by which这是一个定语从句，是指前面提到的standard. 你的那句是错误的，你可以把by去掉，如果再后面用by,整个句子成分不全，少了主语。