There are a great many who do not consider this to be a mistake. The fact that after half a century, Unix-like operating systems and programming environments are de rigueur is plain enough evidence of this. I can't think of much else in the whole field of computing that has had this kind of staying power over such a long period of time, excepting perhaps the idea of binary digital computers themselves.
Fun history note: Part of the reason the Unix userspace and development chain lean so heavily on text processing is because its inventors were tasked with designing a system for more powerful tools for the writing and production of technical documentation. But they were dyed-in-the-wool systems and programming nerds so stand-alone documentation tools were not very interesting. So their solution was to invent a new OS, borrowing the features they liked from other OSes they had been exposed to, under the guise of delivering a documentation production system. If it turned out that this Unix thing they came up with happened to be an excellent programming environment as well, that was just a nice bonus as far as management was to be informed.
One of the greatest hacks of computing history, if you ask me.
Edit to add: As others have pointed out, you are hardly restricted to piping around text. And if you do, the power of text is that you can impose arbitrary structure on top of it, e.g. tabular data, shell scripts, XML, YAML, JSON, etc. Saying it's too bad Unix abstracts everything as text files is like saying it's too bad microprocessors abstract everything down to either a one or a zero when far more interesting number exist.