Why does God allow bad things to happen?

Perhaps one of the biggest facts facing those who have a hard time believing in God is all the bad that happens in the world.  If God is so powerful and he does exist why doesn't he keep this bad from happening?  How could someone who has the power to stop rape, or abuse, or even death from happening just watch idly as it happens.  There is a lot of bad things that happen in the world can't he help a little?  Why couldn't he at least help...  me...

Assuming that God truly does love each and everyone of us, this has got to be one of the hardest things he has to let happen... But why?  Here are the series of questions that helped lead me to the answer:

• What would the world be like if God did prevent all bad things from happening?  The world would be wonderful joyous no pain, only happiness.  Everyone would be with their loved ones, everyone would have what they need and want.
• Could all of us really have all that we want? Certainly the rapist couldn't have someone to rape whenever he wanted or the Murderer someone to kill whenever they wanted. 
• Why doesn't God just make it so they don't have those desires?  It could be argued that if everyone lived in a perfect environment they wouldn't have those tendencies. Although many children have lived in great families and homes and still ended up doing bad things to others.  So really what were saying here is he would have to remove those tendencies from them and force them to be good.  But remember we can't have him just stop with the rapist or the murderer, for everyone to truly be happy we would have to stop the cheater, the thief, the liar. We would have to stop the greedy, the prideful, and even the lazy.  Each of these things as well as all of our own flaws would need to be changed for everyone to truly be happy.
• Do I really want to be forced to be Good always? I don't know about you but I really hate being controlled or forced into anything.  I would rather figure it out through my own trial and errors.  Suddenly i'm not thinking this would be very happy at all.  
• But can't he stop just the really bad? To answer this I just had to think through it more, what is really bad? Where would he draw the line, If we truly put ourself in each person's shoes as God would see, they usually just take a small step worse then what was done to them. For example do we take away the free agency of the spouse who was cheated on because that spouse was about to kill the cheater? Or the free agency of the cheater even though they were abused and neglected, perhaps the free agency of the neglecter because they were lazy.  There are a million different things that influence people to be the way that they are, and while each of us should choose to not take that next step worse sometimes we do.  I think were gonna have to accept all bad or none at all which we already discussed doesn't really work.
• Is there good that comes from the bad?  Its hard to say that any good comes out of murder or rape, but the truth is it does give us a scale of good and bad. By seeing how bad the bad can get we appreciate how good the good is.  In fact it could be argued that if we had no bad at all in our lives we wouldn't know what we had with all the good. It really is the error part of the trial and error that makes us appreciate the success. Whether it is our error or someone else's we wouldn't really learn without it.

This is a hard one to accept but it really does make sense why God has to allow everyone to have our free agency and not step in to prevent us from doing bad.  We wouldn't be able to progress or improve who we are if we weren't given the choice to do so for ourself.  The after life will be a much better place to live in when everyone around us has grown and ultimately chosen to be good of their own free will, especially when we also truly understand the good that we are getting because we have lived through and experienced the bad.