This verse describes conditions in an apostate Israel.
[call the proud happy]; Those who set themselves above others are esteemed to be the “happy” ones. This has echoes of the Book of Mormon statement: “wickedness never was happiness.” (Alma 41:10.) Even though wickedness is not happiness, there are times when we presume that it is. That it’s the precise problem with the proud. They are proud for artificial means, and they esteem themselves because of those things. Since we share the assumptions on which they base their pride, we assume that they are happy.
This happens most often in modern society with the accumulation of goods or money. We assume that someone with a lot of money, or with nice possessions must be happy because we assume that we would be happier with such things. Those who have the benefits of such material accumulation may make the mistake of assuming that they are better than others because of their accumulations. They are the proud, and they are presumed to be happy. The Lord reminds us that this is not the eternal definition of happiness.
This is certainly applicable to the Mesoamerican Nephites. Their envy of other peoples has led to a frequent desire to emulate their society, and has led to a desire for social hierarchies through the last several hundred years of Nephite history. Those desires for wealth and social hierarchy were directly behind the Gadianton robbers that were the cause of the downfall of the Nephite government. The Nephites has certainly assumed that those “proud” were happy, and therefore desirable. It was a costly illusion.
[they that work wickedness are set up]: Those who do not follow the precepts of the gospel are admired. In the Book of Mormon, this would have been seen in the most recent history of Zarahemla, which not too far in the past had given up government by believing Nephites in favor of a government by Gadianton robbers. How much more of a fulfillment of prophecy could the Nephites want?
[they that tempt God are even delivered]: Those who tempt God are those who violate God’s laws. That they are “delivered” indicates that they are not punished in a social sense. This is a continuation of the description of a state of apostasy. Those who violate the laws of God receive no penalty for that violation, but are accepted.