I think there is a lot of wisdom in this. It is quite applicable to our present time, and even in Tolkien's day it was probably quite apparent as well as people were shifting away from older religion-oriented ways of living and life towards the consumer industrial economy."To wean one of the God-fearing from their allegiance it is best to propound another unseen object of allegiance and another hope of benefits; propound to him a Lord who will sanction what he desires and not forbid it. Sauron, apparently a defeated rival for world-power, now a mere hostage, can hardly propound himself; but as the former servant and disciple of Melkor, the worship of Melkor will raise him from hostage to high priest."
Nowadays a lot of traditional religions (Buddhism included in most countries) are quite easily undermined by unseen forces of marketing, consumerism, propaganda, banking, smut and so on. The latter promise people what they desire, commend them for pursuing it and bind the average person into a lifestyle of servitude without them ever being aware of it. This is why the people in charge of our fiat money system (i.e., the banks) wield such incredible power. Whereas money lenders were once looked down upon and speculators were executed, now they have politicians and scholars both licking their boots, for they control both the media which largely glorifies and legitimises their role in the world as well as industry which most people believe is absolutely necessary to have and moreover expand.
Youth brought up in such circumstances look at religion as a dead fossil without any function. The alternatives promise what we both physically and socially desire. Any challenge against this is a challenge against freedom, and so is quickly quashed.