What is it that makes good people do bad things?

I've always been fascinated by what makes people do bad things. My major misgiving with the criminal justice system is this idea of punishment rather than reform. Its seems to me based on the idea that we judging the criminal (bad person) are better than them, are some how more good. To me evil or badness is just a matter of circumstance and upbringing. Evil is a sickness, and prisons aim should be to reform rather to punish. However it should be noted that it is not to say I believe prison should be abolished, in fact I think in many cases prison terms should be longer if possible, but the aim should be to reform a person, rather than to punish them.

I bring this up because I've just watched a fascinating TED talk on the nature of good and evil by Philip Zimbrado. It's a really interesting insight into what factors can make basically good people, do evil things.