(As Joe pointed out) It's about balance! You ABSOLUTELY cannot have one without the other. God created that balance for a damn good reason. So we can understand what true happiness is like. People are born to suffer, born to walk the earth in search for happiness. Buddhists believe that you suffer your entire life until you finally have a clear view of reality and find that happiness you've been looking for and if you don't find it within this life time, Karma will make you repeat that search in the next life.
We suffer because you can't just be born in to happiness. Even kids born in to rich families are miserable. When you came out the womb where you laughing or crying? Order needs chaos, chaos needs order. Without one or the other, there is a huge unbalance and the world becomes a place nobody wants to be in. That's why God made that balance and gave us a choice, gave us free will. You can't say that your god isn't all powerful because you had to suffer for a little bit. It was your decision that brought on that suffereing (8 times out of ten; the other two are acts of God).
If I was God, that's how I'd run sh*t! There's no point in having a race of boring people inhabit the planet. The simple fact that we are born to find peace, love, happiness, compassion and understanding on our own through suffering is what separates us from other animals on the planet and keeps the world spinning. Suck on that Athiests!!!