Evil has no place in the natural order, and still less in the transcendental. The most admirable forms of traditional “metaphysics” — Platonic and Leibnizian — gave it no place there, either. Yet, alongside much beauty and good, there is undeniably an abundance of empirical evil in the world.
Among the various kinds of bad things, there is pain or misfortune; there is merely unreasonable or selfish human behavior; and there is real evil.
On one level, misfortune is a subjective interpretation based on a particular point of view, but having a particular point of view is intrinsic to the kind of beings we are, and calling misfortune subjective does not make it hurt less. Good is a formative influence spanning both the natural and transcendental orders, but it is not omnipotent, and even if it were, there would still be misfortune from particular points of view.
Unreasonable or selfish behavior comes from a lack of good emotional development. While bad, in itself it is not truly evil.
Malicious lies and hypocrisy, pathological cruelty, and systemic social ills are all things that cannot be adequately explained in terms of immoderate emotion or desire. Unfortunately, these all really occur. They are not illusory, and could never be part of a greater good. These I call truly evil. As with misfortune, real evil is possible because good is not omnipotent.
Deep malice and cruelty belong to individual pathology.
Systemic social ills such as extreme inequality and the oppression of groups belong to a kind of social pathology that may be aided and abetted by individual pathologies or by ordinary selfish or narrow-minded behavior, but social ills as such cannot be blamed only on the bad behavior of individuals. Their sources are wider and deeper than that, extending to the contingent factual structure of historical societies. On Brandomian principles, the whole community shares responsibility for combating things like this, over which no individual has control. (See also Stubborn Refusal; Fragility of the Good.)