Education and a strong good moral conviction (being good) are better substitutes for religion. Religion has laid the groundwork for such moral codes, but too many Osama bin Laden's and David Koresh's exist. These people pervert their religions to justify murder, persecution, and oppression.
educated people tend to be less religious.
I believe religion is responsible for a critical amount of good work in the world, and that in truth it does offset the bad. Look at the social justice work of the Catholic Church in Central and South America. The Soup Kitchens, shelters and religious charities all across the Western world. More importantly, for most people, religion does provide the good morals and desire to perform good works that you describe. A few bad apples get all the attention, though.
And I say all of this as an Agnostic who, while believing there is a God of some form as yet unknown to man, still respects and admires those good souls who have real religious devotion and do good works.
And as for religion being responsible for billions of deaths...Last century, atheist communist regimes sparked more bloodshed than religious ones. So perhaps the tide has turned in favor of atheism being more bloody?
Now as for the game...I don't think Sid and co. were worried about encountering a PC backlash. After all, EU employs religious conflict, and I don't think people got offended. I just think they felt the scope of introducing such a concept would have been far too much in terms of keeping gameplay focused and balanced. They also want to keep somewhat of a "generic" feeling to the civs, and introducing specific religions would undermine that to a degree.
Cheers.
PS-- My great-grandfather was a Methodist minister, and he was perhaps one of the most intelligent and compassionate persons you could imagine.
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