The Thin Line between Tolerance and Relativism

Though I consider myself a Democratic Socialist, there is something frightening to me about the increasing liberalness of our society. But let me first justify that comment. I am looking at the big picture here; and it seems clear to me that from generation to generation our nation, and most of the world, is becoming more liberal. From emancipation, to civil rights, to near universal suffrage. I mean, our parents generation would have had legal troubles with marrying someone of a different race. That is fucked up. But we've gone a long way. Sure, there are a lot of people who are still against interracial marriage today--but these tend to be older people, raised in a different cultural climate.
Homosexuals will probably be able to get married soon. Who knows, maybe in a few more generations the government will just get out of the marriage business completely. People wouldn't be punished via taxation for their decision to remain single.
But I am happy about all these changes. I've just read J.S. Mill's "On Liberty", and I'm really pumped up about liberalism. I am sure I will be on the liberal side of things for at least a few more years.
So what is it that frightens me about modern society? You ready for this? Relativism.

One of the most wonderful things about living in an industrialized nation on Earth today as opposed to 100+ years ago, besides educational opportunities and 40-hour workweeks (Thank you liberalism!), is our tolerance for those unlike us. No, not everyone is tolerant. And most people aren't tolerant of everything. But more and more people are becoming tolerant of other people who hold different views and live different lifestyles than themselves. This is beautiful! Diversity is wonderful. Freedom is all about living your life as you please--deciding what is best for yourself, deciding what sources you can get your information from, deciding where to work, what to put into your body*, etc.
The problem is that I hear more and more people from my generation faltering. They somehow make the logical gap from tolerance for others to relativism about truth. The implicit argument makes enough sense:
1. I shouldn't judge people for disagreeing with me about what is true or moral, because I don't know any better than they do.
2. But I certainly know a lot about what is true and moral.
/:. 3. So, what is 'true for me' must be different than what is 'true' for someone else.

The problem with this argument is premise 2. The whole idea behind tolerance, as I see it, is that we DON'T know what we think we know. I think that most of us would admit that we probably have some false beliefs. And we would admit we aren't sure which of these beliefs we are wrong about. So, we ought to have tolerance of others based on our acknowledged ignorance. The problem is that people want to have it both ways. They want to be tolerant AND arrogant. They refuse to admit their own ignorance.
Take religion--this is a prime example. Let's say Sally is a Christian, and Sarah is Jewish. Sally is tolerant. But is she tolerant for the right reasons?
The wrong reason: Sally thinks that both her and Sarah have true religious beliefs. She believes Christ is the son of God is 'true for her', and Sarah's not believing so is 'true for Sarah'.
The right reason: Sally realizes that such a deep metaphysical question such as those about religion are unknowable by humanity. She acknowledges that her belief in Christianity is a 'leap of faith', and as such, is fallible. Epistemically, she is in the same position as Sarah, so she respects her differing beliefs.

I see this relativism all over the place. And I see the logical slip that causes it. And its an easy mistake to make. So how can we perpetuate tolerance while retaining absolutism about truth?