They may have been beaten down verbally earlier in life by someone who told them they'd never amount to anything. They may have had too many things go wrong in their life and they've just given up. They start to listen to and believe their negative inner thoughts. They don't trust their ability to make decisions. And those who can't cope at all often fall into depression.
Many people become critical of others.
I find this quite a bit in the business world. I often hear of a boss or supervisor that is extremely critical, always complaining, never complimenting. Very often, the boss is the one with low self esteem. You need to talk with them in a non-confrontational way. Ask to speak with them and explain gently how they've become critical on a continual basis.