Don knows that drinking too much liquor is a costly habit that is bad for his health, but he continues to drink large amounts of liquor. he also thinks he is a smart person that makes good choices. don feels some psychological discomfort from this contradiction, which is also called:

This is also called Cognitive dissonance
Cognitive dissonance refers to a psychological stress that individuals experience when we're force two face two different contradictory belief or values at the same time. On this particular case, Don face the contradiction on the fact that he think himself as smart and his disability to do something right even though he know that it's going to affect him negatively.