Pork butt, despite its colorful name, does not come from anywhere near the butt or behind of the pig. Pork butt is a cut of meat from the shoulder of the pig. Seriously.
So where does the cut of pork called pork shoulder come from? Also the shoulder. Technically "pork butt" (as well as Boston butt, a different name for more or less the same cut), comes from the thicker section of the shoulder where there is more intense marbling. This makes the "butt" an excellent cut for pulled pork and barbecue. Cuts labeled "shoulder" (including a "picnic shoulder") are from the thinner, triangle-shaped end of the shoulder (it would be attached to the "butt" if they weren't separated into smaller cuts).
Both the "butt" and "shoulder" cuts need long, slow cooking and are great barbecued, braised, or used as stew meat, so you can, if necessary, use them interchangeably in most recipes.
And that area of the pig we might think of as more of a butt? That's where the ham – cooked fresh or cured or smoked – is from!
Note: Many styles and regional variations exist in butchery, so when in doubt, ask your butcher for specifics.