One of the most puzzling Catholic practices is confession of sins to a priest. Why, people ask, can't we just confess our sins to God? In fact, why do we need to confess our sins at all? Can't we just tell God that we're sorry for all our sins and be done with it? He already knows what we did before we tell Him, so why does it matter? Let's examine this issue and see why the Church teaches what she does.
God knows what's best for us, even if we don't. He made us a certain way, and He knows all the little intricacies of human nature. Thus, just as a mother may make her child study because she knows he'll be elated when he gets a good grade, God makes us do things that we don't want to do because He knows we'll be better off. When we do something wrong, telling someone helps to relieve the feelings of guilt and shame that may remain even after we know that God has forgiven us. In addition, it forces us to take responsibility for our actions. When we name the particular sin we committed, we become more aware of our sinfulness than if we just admit that we sin. We can then reflect on them and better decide how to resist temptation. Thirdly, confessing our sins to another person humbles us. It's not easy to tell someone all the bad things you've done, and it certainly knocks us off of whatever prideful pedestals we may have built for ourselves.
I think most people would agree that confessing your sins does have some psychological benefits, and so would God. When God found Adam and Eve after they had sinned, He gave them each a chance to confess their sin, Adam first (Genesis 3:11) and then Eve second (v. 13). Then, when Cain killed Abel, God also gave him a chance to confess his sin (Genesis 4:9). In asking them what they had done, God was not seeking information; He was not investigating the crime scenes. In His omniscience, He already knew what they had done, but He was giving them a chance to confess because He knows that confession is good for us.
In addition to the spiritual and psychological benefits of confession, there's quite a biblical precedent for it. Some big names in the Old Testament, such as Nehemiah (Nehemiah 1:6) and Daniel (Daniel 9:20), confessed not only their sins but all of Israel's sins as well. When people went to John the Baptist to be baptized, they would confess their sins to him (Matthew 3:6, Mark 1:5), and the people of Israel confessed their sins and the sins of their ancestors (Nehemiah 9:2). In Psalm 32:5, the psalmist confesses his sins to God and is forgiven.
Besides there being just a precedent for confessing our sins, Scripture commands us to do it. God commanded the Israelites to confess their sins (Leviticus 5:5, Numbers 5:5-7), a law that, like many others in the Old Testament, is fulfilled in the New Covenant (Matthew 5:17-18). Proverbs 28:13 says that unless we confess our sins, we will not be forgiven, and James 5:16, a passage that we will return to soon, also exhorts us to confess our sins to one another. When Jesus instituted the sacrament of confession (John 20:21-23), He made it the normal means of having our sins forgiven. Otherwise, it would have been almost pointless for Jesus to have instituted the sacrament at all.
So, were does the priest fit into all of this confession business? In Leviticus 5:6, after a man confesses his sins, God says that he must also have a priest atone for them with an offering of a female sheep or goat. On the Day of Atonement, the high priest would confess all the sins of the people over a goat that was then sacrificed (Leviticus 16:21), and he could only know the people's sins if they confessed to him. In John 20:21-23, Jesus breathed on the apostles (the only other time God breathed on man was when He created him in Genesis 2:7, so this event was important) and gave them and all subsequent priests (through ordination) the power to forgive sins. In James 5:14-15, James says that the elders of the Church should pray over and anoint anyone who is sick. "Therefore," he says in verse 16, "confess your sins to one another, so that you may be healed." Because the prayers of the priests can bring forgiveness of sins, we should confess them. The trick, however, is that the priest can only know what sins we want forgiven if we tell him.
But why does God command us to confess our sins to a priest? Why not just any Catholic? First of all, priests, as "professional religious" (for lack of a better term), are the official representatives of the Church, the body of Christ. Since the whole body suffers when one part suffers (1 Corinthians 12:26), it follows that we are all affected when one member sins. Thus, it's fitting that God extends His mercy through an official representative of the Church. Secondly, priests, having received ordination (1 Timothy 4:14, 2 Timothy 1:6), are the only ones who can act in the person of Christ, which a priest needs to do to forgive sins. In 2 Corinthians 2:10, Paul says that he has forgiven people in the person (some translations say "presence," but "person" is a more accurate translation) of Christ. Thirdly, priests are our spiritual fathers (1 Corinthians 4:14-15, 2 Corinthians 12:14, 1 Timothy 1:2, Titus 1:4), and in the confessional, they give us advice on how to overcome our sins, which is something a father should do. In addition, as spiritual fathers, priests represent the Church, just like a father represents his biological family, which ties into the first reason I gave.
So, what does this all mean? Will we go to hell if we don't confess every single sin we've committed? No, that's not what the Church teaches. We must distinguish between mortal and venial sins (1 John 5:16-17), and only the former need to be confessed. John tells us that our prayers are enough for the forgiveness of venial sins.