I have heard that said more times than I can count since I was regenerated over 25 years ago, yet- I am still surprised when I see how far people (Christians) are willing to go in their sin lives before they repent.
Sometimes there is no true repentance, but only sorrow at "getting caught," like when a child who has cookie crumbs all over their face is confronted by Mom or Dad. Prior to being discovered the child is not sorry and may not experience guilt and being caught only causes them to be sorry they were not more careful in erasing the evidence. This kind of illustration is as common as sunshine and pertains to both big and small infractions of the rules of life.
The habitual speeder experiences no guilt at disobeying the law until the red and blue lights are flashing in the rear view mirror, the over-eater is not sorry until their clothes are too tight to be comfortable, and we are often too comfortable with our sin habits until some one has the guts to point them out to us. Sin makes us stupid.
I do believe it is because we think that unless we are caught we are innocent. If no one sees us commit our transgressions then they are somehow not real or even sin, just a "mistake" or an "oops."
How easy it is for us to ignore the reality that God sees all. Cain thought his sin of murder was well hidden (Gen 4). No one was around when he killed his brother Abel- no one but God.
He (God)said, “What have you done? The voice of your brother’s blood is crying to Me from the ground. Genesis 4:10 (NASB- additional word mine)
We know from the entire text that Cain was used to hearing God speak, and doubtless God had spoken to him in many different places. I am convinced that Cain knew that God was everywhere (omnipresent) and that God knew all (omniscient) so what convinced Cain that his deed would be unseen? Sin made him stupid!
Saul, was King over Israel and became very wise in his own eyes. He was sent by God to destroy the Amalekites and to kill everything and everyone- take no prisoners (1 Samuel 14-15). Saul decided that it would be better to keep some of the best of the spoils for a sacrifice to God, and to keep the Amalekite King as well! Saul knew what God had said and decided his was was a better way... Sin made him stupid, and cost him the crown. God rejected Saul as King over Israel for that stunt!
I think part of why this happens to us is we do become too wise in our own eyes, we do take the grace of God for granted, and on some level, we believe we are going to either get away with it, or that our idea is so superior to God's that we are just going to help God out a little.
Over time, such repeated disobedience hardens the heart and we no longer have ears to hear the soft voice of the Spirit as He wants to convict, rebuke, and warn us of the deadly path we are on. Our opinion of ourselves becomes so lofty and high that before long God becomes our consultant and not our King, Lord or Ruler. We submit our predetermined plans to Him for His stamp of approval rather than allowing His Spirit to direct us through His Word. This is truly tragic for us and is the cause of untold heartache in our lives.
The cure for sin that makes us stupid is repentance and humbling ourselves before our mighty God.