Christian theists like me have often argued that the reality of evil actually suggests theism. That is, evil implies an intelligently and transcendently derived moral law, which in turn implies an intelligent and transcendent moral legislator – presumably God. Some skeptics have argued, however, that even if the law of good and evil suggests a deity, it suggests only a deeply flawed deity, one who at best allows evil and at worst actively promotes it. Philosopher Stephen Law, for example, has advanced what he calls the "evil-god challenge": According to the evil-god hypothesis, as Law terms it, there exists a creator of the universe, and moreover this creator is omnipotent and omniscient. Unfortunately that's where this god's similarity to the God of Christian theism ends:
But suppose he is not maximally good. Rather, imagine that he is maximally evil. His depravity is without limit. His cruelty knows no bounds. There is no other god or gods – just this supremely wicked being. Call this the evil-god hypothesis.
Law goes on to defend the evil-god hypothesis against one potential defeater, the problem of good, or "why an omnipotent, omniscient, and supremely evil being would allow quite so much good into his creation." What makes the evil-god challenge so interesting is that for every theodicy proposed for the God of traditional theism against the problem of evil there is, or at least there appears to be, an exactly corresponding theodicy that can be proposed to defend evil-god against the problem of good. For example, against the soul-making theodicy of Hick, in which God uses hardship and loss to build the spiritual character of people so they can more deeply appreciate goodness, Law suggests that evil-god allows love and beauty only in order to accentuate hate and ugliness, so that sufferers can learn to more deeply despise the evil they experience. Just a few really wealthy, powerful people are needed "to make the suffering of the rest of us even more acute." Law's point seems to be that all the vagaries of our moral universe permit rational interpretations not just theistic and atheistic but downright diabolical.
I suggest there is a way to break Law's rhetorical impasse, namely with an appeal to the ontology of goodness itself, as expressed in Augustine's observation that evil is (must be) privation of good. On this view evil is simply the absence of good, a corruption of what God has made. Thus a hateful, cruel and lazy man is also loveless, merciless and shiftless, whereas it would make no sense to say that a loving, merciful and diligent man is hate-less, cruelty-less and laziness-less. Love, mercy and diligence are positive moral attributes; hate, cruelty and laziness the negative attributes ascribed to those who fail them. This makes sense of Paul's statement that "all have sinned [committed evil acts] and [thereby] fall short of the glory of God" (Rom. 3:23). Our ongoing experiences of evil in the world serve as constant reminders of the fact that man has sinned against his God by falling short of God's righteousness. Even the atheist philosopher Schopenhauer recognized that the very notion of moral perfection, of innate righteousness, points to the fall of Adam:
Why the will erred, how it erred, how it could have erred, Schopenhauer does not say, and knows he cannot say – they are questions beyond all power of answer. But the idea of a fall…seemed to him a metaphysical and a moral necessity.
Following the ancient philosopher Epicurus, most of us at one time or another have asked, "Whence comes evil?" (We ask it, for example, whenever we find someone committing an act of overt wickedness and cry out in exasperation, "What's wrong with that person?") I propose that any acceptable answer to that question must begin with an acknowledgment that evil is not a thing to be examined or analyzed, but the practical, spiritually significant outcome of failing God's righteousness. But if God is perfectly good, and the supervisor of a perfectly good creation, it might still be reasonably asked how anyone could fail God's righteousness in the first place.
My own answer begins with the historical-theological observation that God, as narrated in Genesis, at creation conferred great dignity upon human beings by giving them (us) not only wide-ranging moral freedom but tremendous responsibility to manage the affairs of the world we inhabit. Richard Swinburne alludes to this with his "argument from providence." The basic idea is that freedom is a great good. Human beings are baffled by evil (and attribute it to a failure of God) because we neither understand nor appreciate the power we have to influence the moral direction of the world.
Consider the "Song of the Vineyard" in the fifth chapter of Isaiah, a parable speaking metaphorically of God's care and provision for his people:
My Well-beloved has a vineyard on a very fruitful hill.
He dug it up and cleared out its stones,
And planted it with the choicest vine.
He built a tower in its midst,
And also made a winepress in it;
So he expected it to bring forth good grapes,
But it brought forth wild grapes (Isaiah 5:1-2).
This "vineyard" alludes further to the Garden of Eden, where the first couple was given great provision and every reason to prosper under the watch of their creator. But they were also morally free, and therefore able to disobey as well as obey their Lord by eating of the one forbidden tree. Thus God asks his rebellious people, the "wild grapes" of his vineyard: "…O inhabitants of Jerusalem and men of Judah… What more could have been done to my vineyard that I have not done in it? Why, then, when I expected it to bring forth good grapes, did it bring forth wild grapes?" (v. 3-4). God being omniscient, the question is obviously rhetorical. We may call it the "good God challenge." The point seems to be that pains and problems may arise in the vineyard, no matter how well-tended, from within the "grapes" themselves. Here God almost appears to "isolate the variable" of free will, i.e., the freedom to obey or disobey, in the hearts of his people, with the understanding that the human heart is the one variable that divine providence cannot – or more properly, will not – directly control.
All this seems consistent with Christian theology as well as observations of the world around us. Evil does not derive from an evil god, but from the corrupted hearts of countless evil human beings who have, in turn, been tempted by Satan (himself a corrupted being as thoroughly evil as one can be, hence as close to "evil-god" as one can be). The problem of evil is only "solved" as we come to God in repentance and obtain His righteousness, through another free act of will: the exercise of faith in Jesus Christ. Paul again lays it down to the Romans: "….for all have sinned and fall short of the glory of God, being justified freely by His grace through the redemption that is in Christ Jesus…that He might be just and the justifier of the one who has faith in Jesus" (Rom. 3:23,24, 26).
 Stephen Law, "The evil-god challenge," Religious Studies, 46 (New York: Cambridge University Press, 2010), p. 356.
 Salter, William M., "Schopenhauer's Contact with Theology," Harvard Theological Review, Vol. 4, No. 3 (1911), p. 290.