Evil: Kabbalistic views
The primary Kabbalistic term for evil is sitra achra, which means "the Other side." In the subtle depth of this term alone lies some of the most transformative wisdom of the Kabbalah. Although often mythologized in terms of demons and devils, the "Other Side," at its root, is not separate from the Divine. Coins have two sides; papers have two sides; God has two sides, at least from our perspective. All are essentially one thing; what we experience as evil is as Divine as what we experience as good.
Naturally, no one wants to believe this. It's fine to think "everything is God" on a warm summer's day, when the birds are singing tunes of Heaven. But what about in a hospital, where a child is dying of cancer? What about in the gas chambers? For that matter, what about any situation in which our moral faculties are aroused, and the presence of evil is as palpable as the sunlight?
To say that evil is part of God is not to say it doesn't exist. Everything is part of God: the self, objects in the world, this computer. "Exist" is a property we ascribe to these objects, and which we do not ascribe to, say, dragons or unicorns. That is because this computer does things that a unicorn does not -- it appears, it reliably functions as an object, and so on. Likewise, to say that evil is "only" part of God and is not "ultimately real" does not alter its significance in our daily lives.
But it does alter how we relate to it. Many texts in the Kabbalah, including the Zohar, say that the task is not to destroy evil but to return it to its source -- to "include the left within the right," in the Zoharic metaphor, "to uplift the fallen sparks" in the Lurianic one. In Chabad Hasidism, it is stated that evil exists as part of the Divine revelation itself. Indeed, to think that evil really is separate from God is, itself, the essence of evil, which is precisely the illusion of separation.
The most common form of this evil is something we all do all the time: assume that we are separate from God. The natural consequence of this belief is that "good" and "bad" are best evaluated according to how they benefit or harm the self. Thus, enriching the ego, making ourselves feel good (materially, usually, but also spiritually) -- all these quintessentially human endeavors stem from the illusion of separation. The yetzer hara, conventionally known as the "evil inclination," might be better thought of as the "selfish inclination" or the "separating inclination." It is that which grounds all experience in the separate self, and does its best to enlarge, enrich, and empower that self above others.
Conventional morality posits a dualistic psychology, in which a yetzer tov, a good inclination, balances out the evil one. For the Kabbalah, however, there is only truth and falsity: the truth that only God truly exists, and the falsity that all of our own conventional existence is real. Truth leads to those acts which benefit God -- for traditional Kabbalists, that includes ritual as well as ethical behavior. Falsity leads to those which seem to benefit the separate self.
This is hardly the end of the story. Some heretical Kabbalists believed that "acts which benefit God" include deliberate forays into the world of "sin," where the illusory nature of evil can be more readily exposed, and the sparks thereby elevated to their Source. Traditional Kabbalists and Hasidim, however, maintained the opposite: that the Torah provides the blueprint for right action, and that once the selfish inclination is abnegated, what remains are the commandments. The fundamental cosmology is the same, but the consequences are completely different.
Letting go of the reality of separate evil, and really accepting that the sitra achra is a side of Divinity, is easy on paper and very difficult in reality. Sitting in a cozy armchair, it's possible to meditate on the unity of all being, even those which are horrible. But when one is in the midst of the horror, I suppose, it becomes a rather different enterprise, and much closer to the ideal of the saint.
Still, to the extent it is possible to do so, the notion is indeed life-changing. Everything is a flavor of Divinity — we may naturally want more hesed and less gevurah, and indeed, the Kabbalah contains thousands of incantations, intentions, and actions to shift the balance in just that way. But even the dinim, the harsh judgments which we experience, are a side of the Divine manifestation. I think all of us can find the edge of tolerance in this area. Some endure life-threatening traumas and yet are able to maintain the wider view. Personally, I can lose my proper perspective after only mild physical violence. Perhaps the right work on the self is to find the edge and expand it, gradually allowing more of God to exist without forgetting. This does not remove the imperative to fight against evil, of course — only the constriction and delusion which can sometimes accompany it.