It is comforting to lie to oneself.  Comforting, but dangerous.  At times, very dangerous.  It is a matter of degree: a little bit is not so bad, but a great deal can be terrible, most especially when it affects other people.  

When you lie to yourself, you're trying to avoid facts, not face hurtful truths.  It is significant that one of the age-old meanings of the name "Satan" is "the liar."  Does it mean not to lie to others, or not to lie to yourself?  Perhaps you can't successfully lie to others unless you lie to yourself first.  That definition, "liar," tells us something important about how dangerous it is to lie to yourself, because the first lie looks to be the basis of all others.  

Very young children lie to themselves all the time.  They don't even know they're doing it.  Every parent has experienced, many times, having their youngsters deny responsibility for their actions and instead blame it on someone else: "You/he/she/they made me do it."  It's not my fault; it's someone else's! They deny responsibility for what they did, and in doing so, lie to themselves and refuse to admit the truth.  

When people lie to themselves, it is to maintain their self-esteem, to feel they are in the right, that they are the good guys. It is painful for some people to admit they're not only in the wrong, but have done terrible things to others.  

When people lie to themselves, a lot of the time it is used to maintain this position: "I am right, and you are wrong."  When people lie to themselves this way, when it's used to deny responsibility for what they've done, it always involves blaming others: "Since I didn't do it, someone else has to have done it." 

In children's fairy tales, good and evil are portrayed in the whitest of whites and the blackest of blacks.  It's because children can't understand the complexity of life in all its shades of grey.  When they get older, they're supposed to understand those greys, and that everyone is imperfect, and no one is either all good or all bad.  

What we've got then, is the belief that we are "good" and our opponents are "evil" as being similar to the child's dreamworld you find in fairy tales. It is based on lying to oneself and refusing the face the facts.  In the adult world, hopefully more clear and realistic than a child's world, we're supposed to face the truth about all the complexities involved in those shades of grey--that no one has clean hands. 

We're dealing with a child's level in which we are "good" and didn't do anything, and were attacked by the "evil" because we are "good," then an adult's level in which we were attacked because of what we've done to others.  Revenge, resentment and envy make a lot more sense than cackling evil geniuses hiding, Smaug-like, in caves and plotting our downfall because they hate our freedom and "democracy.

When people consistently blame their problems on others, psychologists call them "character disorders."  It's a disorder of responsibility.  It's the opposite of a neurotic, which is someone who takes too much responsibility.  It's the difference between a cat, who always thinks it's your fault, and a dog, who always thinks it's his.  

A character disorder has always caused more problems in the world than mere neurotics. The story of Satan, who blames his problems on everyone else, is the story of a character disorder.  I haven't yet found any great, profound stories about neurotics, pace Woody Allen.  It's because the cause of human evil in the world is those childish people who, lying to themselves and refusing to face the facts, deny responsibility for what they've done and instead blame everything on others.