Very few people believe they are bad people. In fact, it is probably only the saints who think of themselves like that. This is because the saints have the greatest idea of spiritual good and so see how far they fall short. But most people don't think of good and evil in spiritual terms. They think in terms of what may increase happiness or suffering for themselves and others in this world with no understanding of the relevance that might have to the next. We are probably more deeply into that misunderstanding now than at any time in history. You would have to go a long way back to reach a moment when people were more spiritually ignorant than today which is why it is fair to say we are the most evil generation in in a long while. Not evil in terms of violence - harm avoidance is one of our greatest concerns, see the last 21 months - but evil in terms of our rejection of spiritual reality. Spiritual reality is truth. To reject truth is to reject the good and is therefore evil. Looking at the matter in terms of harm, one could say we are causing great harm to the soul. That is evil.
Imagine a cross with the vertical arm signifying spirit and the horizontal one matter.
Then imagine that everything above the horizontal line is spiritual good with everything below spiritual evil. In the same way, everything to the right of the vertical line is material good with everything to the left material evil. You might think that today we are firmly established in the lower right section but I would say that is only where we hope to be. In reality because the material is part of the spiritual we are actually moving into the lower left section if we are not already there. For the truth is that if we seek material good without encompassing the spiritual in that we will not even have material good after a certain while.
Good and evil have their counterparts on the material level but they are actually spiritual concepts and if we fail to see that we will inevitably lapse into evil which is what has happened to us. To deny spiritual reality is to be evil. This may seem a hard saying to those who wish to lead a good life in this world and even help others in their society to do the same but we are spiritual beings who happen to be in material bodies for a spiritual purpose. To ignore or reject that truth is to put yourself firmly in the camp of evil however good you may appear in worldly terms.
What is good on the material plane can coincide with spiritual good but it does not by any means inevitably do so. Equally, material evil can lead to spiritual evil though it does not necessarily do so. Suffering is a part of spiritual life as the ego must be stripped of its egotism. When Jesus said it was harder for a rich man to get to heaven than for a camel to go through the eye of a needle he was drawing attention to this difference between good conceived spiritually and materially. The only true good is what leads to the elevation of the soul.