The Church teaches that baptism regenerates our soul and we receive sanctifying grace. God did create humans good but after the fall we inherited original sin and the consequences of that sin. But through our baptism we are reconciled to that same state in which we were created. Saint Paul says that we are a new creation in Christ.
So, humans are not “cow dung” (to quote Martin Luther) covered with snow (the righteousness of Christ). We are called to be holy and our souls reflect the choices that we make. We have the opportunity to remain in the state of grace and thus united with God. We do not have a foul stench of a soul wrapped in fine linen. We are a temple of the Holy Spirit and that can only allow for a soul that will house our God… teachccd