Jargon! I love it! As long as it’s my own, that is. 
In psychiatry, it’s rationalization, the unconscious substitution of a virtuous explanation of a particular act for an explanation of which the doer is not proud. Or, in practice, it’s apt to be a selection of the most virtuous reason from a bunch of equally real ones, e.g. I’m not buying the kids a Wii because they always lose or break anything I get them, and it irritates me, and I’d rather spend the money on toys for myself and then I’ll enjoy it more than they ever would, plus . . . well, it would mean more to them, and they’d appreciate it more, if they earn the money and save up for it. It’s a life lesson, they’ll know the satisfaction of working for what they want . . . yeah, that last one.
In the OP’s example, someone has done something that seems silly or pointless, and would be embarrassed to think of themselves as apt to do silly things, so a reasonable explanation “just feels right.”
If you do it consciously and deliberately, it’s not rationalization any longer and is variously described as diplomacy or dishonesty.
Rationalization is used to describe normal functioning in generally healthy minds. Outcomes can be trivial or catastrophic, but are not the result of mental disorder. Confabulation is substitution of a fictional narrative to fill in amnestic gaps, and is most often used in describing significant dementia. Equally unconscious, so not a lie or an attempt to look important.
So, for psychiatric purposes, if I said Joe Doakes was rationalizing, I would be describing him as a regular guy who might think of himself as a little more noble and generous than he probably is. If I said he was confabulating, I would mean things are seriously wrong with his brain, and that neurology rather than psychoanalysis would offer more insight into understanding his case.
It’s completely possible that the terms in question have somewhat different meanings in other disciplines. That happens often. They definitely have broader connotations in the vernacular, in fact broad enough to benefit from a little definition of terms.
Ragiel, M.D., shrink.
