Q: A Lubavitcher asked me, “why does God make peace and create evil? Why does He do both these things?” This person insists that God created the devil as an angel and the devil has no power to do evil without God's approval. Therefore, since God created evil (Isaiah 45:7), God is in control of all that we do as Jews.
A: There is a basic misunderstanding as to the usage of the Hebrew word ra. It is used in Classical Hebrew in two different senses. It could mean “evil” in the sense of sin, but it can also mean “evil” in the sense of calamity. That is the way it is used in reference to God. The Bible makes it clear that God is not the author of sin and James argues that in detail. God does not create sin, nor does He tempt anyone to commit an act of sin.
In so far as causing calamity, God certainly does cause calamity such as the Noahic flood and other physical judgments. That is the meaning of the text in reference to God.
It is, however, also true that Satan's ability to do evil is within the permissive will of God. What Satan could or could not do to Job and his family and his property was based on what God permitted him to do.