While I frequently return to the danger of simplistically reducing everything to good and evil, it has been a while since I have tried to take on the more fundamental question of the nature of evil itself (without simply positing it in opposition to "good"). Indeed, in scanning through my records, it appears that my last source for addressing this question was Hannah Arendt. I am not sure how familiar Arendt was with the writings of Carl Jung. As nothing other than a wild guess, I would assume that she was aware of him but not that familiar with his writings. Nevertheless, there may be a "family resemblance" (even without any direct "kinship connection") between these two minds on the subject of evil.
For Jung's perspective I turn to his Psychological Types book (which I am continuing to read) and his analysis of Prometheus and Epimetheus, a (now little-known) poetic work by Carl Spitteler published in 1881. This may best be described as a meditation on the myths involving that race of Titans that preceded the traditional Pantheon of Greek mythology, concentrating on the brothers Prometheus and Epimetheus and the sister Pandora. However, Spitteler explores events other than the best-known ones, such as Prometheus' theft of fire and Pandora opening the forbidden box. Rather he focuses on a fundamental difference of character: The actions of Prometheus are guided by his soul, while those of Epimetheus are guided by the objects of the world. One might say that they embody the distinction between the "inner world" and "external reality" (in quotes because these are phrases that Jung employs).
Where this gets interesting is when Jung explores that element of Spitteler's plot that involves the formation of a "pact with evil." Here is Jung's text:
… we are immediately struck by the fact that the pact with evil came about by no design of Prometheus but because of the thoughtlessness of Epimetheus, who possesses a merely collective conscience but has no power of discrimination with regard to the things of the inner world. As is invariably the case with a standpoint oriented to the object, it allows itself to be determined exclusively by collective values and consequently overlooks what is new and unique. Current collective values can certainly be measured by an objective criterion, but only a free and individual assessment—a matter of living feeling—can give the true measure of something newly created. It also needs a man who has a ‘soul’ and not merely relations to objects.
Recall, now, my quotation from an article by Jeremy Waldron about Arendt:
Part of what Arendt meant by the banality of evil is the possibility of wrongdoing that opens up when this inner dialogue is no longer an important feature of people's lives, so that the prospect of who I would have to live with in myself is no longer a concern.
Spitteler's Prometheus lives by that inner dialogue, while Epimetheus, anticipating the age of "management science," abstracts it away in favor of the clarity of objective criteria; and it is that abstraction that ultimately brings evil to a world that the Titan brothers have been fabricating for mankind. This strikes me as one of the best working examples of what Giambattista Vico had in mind when he introduced the concept of "poetic wisdom." It also offers our contemporary situation a prescient opportunity for reflection that we can ill afford to ignore!