"If God knows all, how did satan come to be? A perfect God would not create an offspring knowing full well that that child would never have a chance at eternal salvation. The only thing I can think of is if somehow God hadn’t achieved omniscience at the time he procreated Lucifer. This way He knew that one of His children would end up becoming the devil but not which specific one. I have no idea if this postulate violates doctrine.
"Adding to the previous entry, this gives rise to the idea that God knows before He creates each spirit what the eternal fate of that spirit will be. This being stated, would a perfect God create myriad souls, much less a single soul, that wouldn’t achieve eternal life, or, more basely, that would become perdition? One idea is that He doesn’t know (whether by choice or by eternal law I couldn’t say) the person until after He creates them. Another is that since God can see eternity, the concept of Him knowing what’s going to happen and what’s not isn’t the same in the eternal sphere as that which we can comprehend."In order to understand my son's proposition, it is necessary to understand the LDS doctrines of the nature of God, the plan of salvation, and the nature of the devil. As explained in this Encyclopedia of Mormonism article on God, God is a term that includes the Divine Father, his son Jesus Christ, and the Holy Ghost. However, LDS scripture states that "The Father has a body of flesh and bones as tangible as man's; the Son also; but the Holy Ghost has not a body of flesh and bones, but is a personage of Spirit" (D&C 130:22).
As explained in this EoM article on God the Father, God the Father is omnipotent and omniscient. He "existed prior to the Son and the Holy Ghost and is the source of their divinity. ... He is ultimately the source of all things and the Father of all things, for in the beginning he begot the Son, and through the instrumentality of his agent, the Son, the Father accomplished the creation of all things."
LDS doctrine further states (see EoM: Plan of Salvation) that God's plan for the eternal happiness of his children involves several stages, including life with God in a premortal existence, life on earth for those that chose to move forward with God's plan, and a postmortal eternal existence, the quality of which is dependent on one's acceptance of the Atonement of Christ and willing adherence to divine principles. Unlike some religious teachings, LDS doctrine provides for ample opportunity both in this life and afterward for all of God's children to ultimately achieve the greatest glory God has to give.
The above referenced article on God the Father states, "All individual human spirits were begotten (not created from nothing or made) by the Father in a premortal state, where they lived and were nurtured by Heavenly Parents." In The Family: A Proclamation to the World, LDS prophets and apostles state, "Each [human being] is a beloved spirit son or daughter of heavenly parents, and, as such, each has a divine nature and destiny."
Prior to our birth as spirits in the premortal life we existed as eternal intelligence, which "was not created or made, neither indeed can be" (D&C 93:29). But as explained in this EoM article on Intelligences, God has not yet revealed more about the nature of our prespirit state, so more specific pronouncements about it are merely speculation.
One of God's significant characteristics is his commitment to the agency of his children. The Father "will never violate individual agency by forcing his children to exaltation and happiness. Coercion in any degree, even in the form of predestination to the Celestial Kingdom, is abhorrent to the nature of the Father."
Having rudimentarily outlined the doctrines of God and his plan of happiness, we still need to understand the nature of Satan. "In the premortal life, Lucifer was an angel having authority in the presence of God. He played a prominent role in the Council in Heaven. After the Father in Heaven offered the plan of righteousness to help his children become as he is, Lucifer countered with an alternative plan" designed to spare individuals the pain inherent in the Father's plan, but that would eliminate agency and transfer God's glory and authority to Lucifer (EoM: Devils). For this rebellion Lucifer and his followers (consisting of one-third of the spirits in that realm) were cast out to the earth, having forsaken their opportunities to receive physical bodies and to progress eternally.
This set of doctrines requires that God (being all knowing) knowingly (and being all powerful) deliberately allowed Lucifer to receive a spirit body in the premortal existence; although, God was completely aware that Lucifer would ultimately rebel, would be the means of eternally turning one-third of God's spirit children into devils, and would perpetrate much evil on the earth. In my son's mind, a perfectly loving God would not do such a thing.
I told my son that I begged to differ with his interpretation. "Because of [his perfect] love, it is the nature of the Father to improve everything and everyone to the extent that they will allow" (EoM: God the Father). God would love for each of his children to own the eternal joy and glory that he owns, but the only way for that to happen is through the completely voluntary choice of individuals to follow God and do his will. This voluntary system necessarily requires the open availability of all kinds of alternatives as well.
Agency plays a preeminent role in God's plan. God can institute and maintain consequences for misuse of agency that violates divine laws, but he cannot preempt an individual's opportunity to make those kinds of choices in a way that violates individual agency. At least, in doing so he would cease to be God.
One friend likened this to a chemist that fully knows beforehand what result will be produced by completing a given experiment. If achieving the result is his goal, it does not matter that he knows what the experiment will produce; he must still complete the experiment to get the result.
So it is with God. He knows beforehand what each of his children will choose to become, but it is essential to his goal of providing for divine happiness that he allow each of his children to actually become what they choose. He lovingly provides the route they must follow to arrive at their optimal destination and he invites them to follow that path. But he cannot usurp their agency to stop them from choosing a different path without renouncing his godhood, as doing so would be antithetical to godhood.
This is the whole reason earth life is structured as it is. The game is played out on a level playing field where neither good nor evil has any clear advantage over the other. Opposition is essential to the great plan of happiness (see 2 Nephi 2). Bad stuff can happen to individuals due to natural factors and the choices of others. But the Savior's Atonement ultimately compensates for any such problems. The important matter is how we choose to use our agency. God will try to entice us to choose his path, but he will never coerce us into doing so, even when he is fully aware that some of his children will perpetrate great evil.
There is no reason to believe that the nature of God was any different in the premortal life than it is now. His omniscience, omnipotence, love, and commitment to agency were not diminished in that state. It did not matter that God knew that Lucifer would follow a path that would lead to perdition. Being God, he had to be committed to Lucifer's agency.
God did not design Lucifer. Rather, he gave birth to a spirit from an eternal intelligence. Refusing to grant a spirit body to this individual—a type of premortal abortion—would have been antithetical to the nature of godhood, as it would have violated Lucifer's agency by short-circuiting his progression along his chosen route. God did not "make" Satan. But he could not refuse Lucifer the opportunity of becoming Satan without ceasing to be God.
Godhood is not for the feint of heart. While it is the nature of God to own a perfect fullness of divine joy, it is also his nature to experience a perfect fullness of divine sorrow. Being God does not mean creating anything in anyway that happens to suit one's fancies. It means adhering to the eternal laws of godhood, which require creating in a way that allows others to choose the divine path.
Curtailing agency, even to circumvent evil, would necessarily also destroy the divine path. Providing a pathway to godhood also means allowing the road to perdition to exist. God can put up warning signs, but he cannot close the road without also closing the divine road. Allowing all willing souls to choose ultimate light also means allowing all willing souls to choose ultimate darkness. There is no other way.
God was not omnisciently or omnipotently deficient when Lucifer was born as a spirit. God was doing what a perfectly loving God does: providing an open opportunity for a soul to become fully divine or to choose a different path. I suspect that in a future day when all hidden things are revealed (see Mormon 5:8) we will more fully comprehend Lucifer's choice and will not charge God foolishly (see Job 1:22) for the result.