Genesis 3:1: The Cunning Snake
But the snake was cunning above all the living creatures of the field which ʏʜᴡʜ God had made... (Genesis 3:1)
A relative had recently asked me some questions about this verse, which can be summarized as (1) what does it mean that the snake is "subtle" (KJV) and (2) why was the snake created this way if God created all things good in the beginning.
It is difficult to give an answer to these questions with 100% certainty and clarity. But a few helpful points can be made:
The key points
(1) God indeed created all things good in the beginning.
(2) Moses is certainly painting the snake as a villian, contrasting the innocence of the woman with the cunning or deceptiveness of the snake.
(3) The Hebrew word behind "subtle" or "cunning" is fundamentally a morally neutral word and ability, which can be laden with either positive or negative connotations by the writer in a particular context. This allows us to see a delicate use of wording in this passage, which emphasizes the cunning or deceptiveness of the snake, while not requiring us to believe that it was created evil.
(4) The behavior of the snake indicates that it was possessed by a supernatural being (Satan).
God created all things good
First, as I have noted before, Genesis chapter 1 strongly emphasizes the goodness of the original creation. That chapter describes the creation as good (טוֹב, ṭōv) six times and then crowns the narrative by stating that creation is "very good" (טוֹב מְאֹד, ṭōv mᵉōd).
Also, chapter 3 begins with a disjunctive clause, in which there is a purposeful contrast between what is happening now, and the idyllic scene of the previous chapter.
The snake as villian
There is a wordplay between Genesis 3:1 and the previous verse. In Genesis 2:25, the first man and woman are described as "naked", whereas here the snake is described as "cunning" or "subtle". In Hebrew, the two words differ by only a single vowel sound. "Naked" is עָרוֹם (˓ā-RŌM), whereas "cunning" is עָרוּם (˓ā-RŪM). Moses is contrasting the innocency and vulnerability of the woman with the cunning and deceptiveness of the snake.
The meaning of עָרוּם
The variety in the English translations of עָרוּם in this verse suggests that it is difficult to nail down the precise meaning. The first few early translations after Tyndale, such as the Geneva Bible and the KJV, all use "subtil", or rather some spelling variation of it. Some other options from the newer translations are "crafty" (NIV, ESV), "shrewdest" or "shrewd" (NLT, NET Bible), and "cunning" (NASB). Aside from the differences between these words, all of these words individually have multiple senses with at least slight differences in nuance.
However, with the support of the NET Bible Notes, HALOT, and a brief word study, I believe we can say safely that the basic meaning of the word is "clever", though this idea is polarized into good uses and bad uses. And by "clever" I mean the ability to use the resources of knowledge or perception to accomplish some end (good or bad).
Looking outside of Genesis 3:1, all the positive uses of this Hebrew word are in the book of Proverbs. These instances are all translated "prudent" in the ESV. The prudent man in the book of Proverbs shows his cleverness in various ways. In 12:16, he is able to see the benefit of not responding to an insult, or in concealing information (verse 23). He gains knowledge before making decisions (13:16). He has a clear understanding of his motivations and goals (14:8). He contemplates his decisions before making them (14:15). He has knowledge, in contrast to the "simple" (14:18). He is able to perceive danger that is not seen by the simple (22:3, 27:12).
The negative uses are in the book of Job. Here, the "crafty" man (ESV) is the man who possesses "devices" or "schemes" which aim to accomplish some evil end, although God frustrates those plans (Job 5:12, 13). Job 15:5 refers to the "tongue of the crafty" (ESV) which is influenced by his sinfulness and his lack of fear of God in his heart.
In another interesting connection (see HALOT) עָרוּם is translated φρόνιμος in the LXX, the ancient Greek translation, and this is the same Greek word used in the New Testament passage Matthew 10:16. That is the passage where Jesus, sending his disciples out as sheep among wolves, commands them to be "wise as serpents, and harmless as doves" (KJV, WEB, ESV, NET Bible). Other translations render it as "shrewd as snakes" (NIV, NLT), or "wary as serpents" (NASB), or "cunning as serpents" (ISV, GWT). Without trying to dive deeply into the meaning of this passage, it appears that Jesus was commanding his disciples to be aware of spiritual dangers. In any case, certainly Jesus was not commanding his disciples to become evil or to practice evil.
So, I believe we have the linguistic freedom here to understand that the snake had a built-in cunning or cleverness that was not originally evil, but was used by Satan when he possessed the snake. I'm not sure what that meant exactly for normal snake life — perhaps some heightened awareness or perception of others, or subtlety of movement, or influence over other animals.
The possessed snake
The NET Bible notes present some other historical interpretations (which see) but argues that the most probably explanation of the snake's behavior is that a spirtual being (Satan) was speaking through it. In the conversation between the woman and the snake, it shows some knowledge and motivations that would be difficult to explain if it were just a snake speaking. For one, it speaks very confidently (though deceptively) of high spiritual and moral matters, declaring that "for God knows that when you eat of [the tree] your eyes will be opened, and you will be like God, knowing good and evil." It is also difficult to explain the snake's bold attack on the character and trustworthiness of God, without a satanic motivation.
 NET Bible notes indicate that "the chapter begins with a disjunctive clause (conjunction + subject + predicate) that introduces a new character and a new scene in the story." This would seem to correspond with the adversative וְ from Williams §432. None of the other options for conjunction וְ in Williams seem to fit the context. It is translated as "now" in the vast majority of English translations (e.g., NIV, NASB, KJV). However, it seems to me that the conjunction "but" (Coverdale, Tyndale) communicates the disjunctive idea with less ambiguity. Perhaps "but" is avoided to avoid sounding informal.
 HALOT gives only two senses for the word, with all the negative uses under "cunning" and all the positive uses under "clever".