Bismarck understood that the meaning of the concept of separation of Church and State was not that the State should have no religion, nor even that it should not discriminate between citizens on the basis of religion. It was that the Church – hitherto the dominant religio-political entity of European life – should be subordinate to the State (government). In other words, the nation-state, as opposed to the trans-national Church, would be the arbiter of all institutions and individuals within its boundaries. And no ruler, particularly no German king, would ever again kneel before a Pope in Rome.
http://www.guardian.co.uk/commentisfree/belief/2010/aug/28/china-future-christianity
[http://news.bbc.co.uk/2/hi/asia-pacific/6337627.stm]
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