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It seems to me that it is a is a death that has been chosen and imbued with purpose, sometimes even by the individual concerned. Certainly by those who perform the sacrifice. It is a way of dying that places the individual apart from the vast majority of other people. Their life has been gifted to a god, or given in service of their family/people (in some ancient societies the boundary was nowhere near as sharp as it tends to be recently); made sacred and set apart from other things.
I guess I would have to question the willingness of the sacrifice. From what I remember from my Old Testament and Classical Archaeology classes, at least some of the humans to be sacrificed were prisoners of war, and I doubt they were happy with their lives being set apart for the gods. And if someone's told that the only way the city will survive is if the gods get a human sacrifice... well, at least a few folks would want to be a hero.
Although I could see the argument that the sacrifice of a willing, consenting individual being similar to assisted suicide and thus not as morally reprehensible as sacrificing someone who wasn't willing.
I think it would be hard to argue that murder is ever right (or at least not often so); however, for many people murder and killing are not the same thing. Murder is a legal concept and many classes of killing are deemed not to count. Killing in self defence, or in service of one's country are generally not seen as murder. Revenge killings by the state are condoned in many countries. A lot of people are in favour of euthenasia; I'm sure you get the point. Not all killing is murder.
I think the line is a very fine one, yeah. I think there are very few legitimate (to me, anyway) examples of killing that
isn't murder, or justifiable murder, and I don't think that human sacrifice is one of them.
I had several responses to this cross my mind, but I hope you will let me ask a little further first. What are the gods to you? I ask in terms both of what role do they play in the greater reality and in terms of what they mean to you personally. I would also ask what do you think they mean/meant to other people, now and in the past?
Good question.

Oftentimes I don't know what the gods are to me. I have a lot of ideas, but since I doubt that I can ever know for certain who or what they are, I don't often ponder it too deeply. (Maybe this is something that needs to change!) I know that when the gods feel real to me (because I've got days where I swear I wake up with the 'atheist and skeptic' switch flicked on in my brain) they feel like individual energetic/spiritual beings with whom I can interact and talk with. I think their role in the universe, whatever that is, is limited and defined. Just as there are things humans can't do without breaking the laws of physics, there are things gods can't do either (without breaking the laws of metaphysics, maybe?). Our relationship seems to be mutually beneficial, with us giving time and attention (and often offerings) and receiving blessings and attention (and often love, or at least a sense of friendship) in return.
I hold gods to pretty much the same moral standards as I do humans, which is probably the reason I don't want to think of my gods accepting human sacrifice (which I'm still not convinced doesn't count as murder, but at least I'm open to hearing the arguments for it, now). They don't get to get away with doing bad things, any more than I would condone a human doing the same. I think that's why I do a bit of a crazy dance around mythology and separate the gods as I believe them to be and the gods as they are represented by humans. If I believed that the myths were literally true, and that my gods did all the raping and pillaging and killing that the myths say they do, I wouldn't even bother with them because I couldn't respect them.
I would like to suggest that you are absolutely right, but not in the way I think you meant

Murder is a Very Bad Thing. If your gods are, or have been, associated with the killing of people (or anything else for that matter) and it is true that not all killing is murder, then you would be right in believing that your gods were not associated with murder if it were also true that killing in sacrifice is not murder.
I'm open to the idea now that human sacrifice might not in all situations be an instance of murder, so thanks for bringing this up. I'll remember it if you end up changing my mind.

True, but these myths have stood the test of time and culture; if not unbroken to now, then at least over long periods. That suggests to me that the truths about the world and the gods that people found in them were more than those of any few poets, bards or other nameless godbotherers. At the very least, it invites me to think deeply on the place of the things that horify me within the greater patterns of reality.
Interesting. Could you explain more about that last bit? How would you personally reconcile interacting with a deity whose actions as represented in myth horrify you?
There's an old thread or two around here that explore that part a bit more than I want to here (but I haven't time to find them just now - sorry). I hope that it makes more sense though in the context of what I have already written here, as well as in response to your ongoing introspection on the issues. Thanks for a post with such interesting facets

I think this has easily become the thread I've put the most intellectual effort in, ever. I think it's good for me to examine my beliefs and reactions like this, even if I'm struggling sometimes to word things the way they make sense to me in my head.