In the Midwest, I notice that some people substitute the word 'says' with 'goes' and this has always bothered me. For example, I will hear someone say something such as "So my mother goes, "you should drink water instead of soda."" instead of "So my mother says, "you should drink water instead of soda."".
Is this simply bad English?
The OED calls that usage of go colloquial. It's a logical extension of the more correct usage of "go" defined as "produced sound" (i.e. "the firecracker went 'bang'"). This usage goes all the way back to the 16th century.
It's interesting to note that the earlier examples it gives refer to people making vocalizations that are not entirely words, i.e. "‘Yo-yo-yo-yo-yoe,’ went the first boy." So it seems like using "goes" instead of "says" is something that is increasing in common usage, at least in informal situations.
It really depends on the level of perfection that you want to measure up those statements. Both statements meet the fundamentals of communication to convey the message; however, if you are more concerned about correctness in the use of language, "goes" is not the proper verb to use but merely slang that is replacing "says." Having said that, if you are concerned about some members of your readership not knowing the slang term "goes," which may cause confusion, I would stick to using "says" consistently.
It depends how you define 'bad'. Languages evolve, and as Janus Bahs Jacquet mentioned in comments "Pop! Says the weasel" doesn't have the right ring to it.
Where you are talking about someone/something expressing a noise (speech, sound, etc), then 'goes' has a similar understood meaning to says (perhaps not a fomal OED definition.
It also depends on the sentence. 'James goes to the shops' is obviously correct vs 'James says to the shops'. So you cannot apply a general rule that 'goes' is a bad/incorrect word to use it.
If bad referes to formality, then using 'goes' is certinaly not correct in the formal sense of the English language.
However, in the example you gave, regardless of which you use, the meaning and intent of the statement is the same. As such it could be considered interchangeable dependant on the formality you are trying to convey or your familiarity with the other party(s) in the conversation.
To me it's bad English to use the word "goes" instead of "said". Example .. He goes, "My day was long". Instead of .. He said, "My day was long". I ask .. He goes?? Where did he go? That always stops the conversation and people look at me like huhhh? Please stop substituting goes for said.
