Now that Cleanthes and Philo have attacked Demea's ontological argument Demea gives what might be termed an "argument from the gut". Given how miserable human existence is, he says, we simply have to believe in God. We all feel God's benevolent presence through the wretchedness of our existence, and this is what makes life tolerable.
Philo sympathizes with Demea's pessimistic argument toward God and the the two of them discuss an alarmingly bleak picture of the universe. In contrast to the perfectly harmonious machine that Cleanthes imagines, they see the world as an awful place. Life for all living things is a struggle. Man alone can master the enemies of his species, but he is no better off because he invents his own enemies, such as guilt and shame. Man is the greatest enemy of man, constantly engaged in oppression, injustice, war, slavery and fraud. Our only escape is death and we are terrified of that. If the world is, in fact, a great machine as Cleanthes claims, then it is only designed to propagate species, not to make any species happy.
Finally, after all of this setting up, Philo reveals why he has been so eager to join Demea in waxing eloquent about earthly misery: he has an argument up his sleeve, his last and his finest. Cleanthes wants to claim that by looking at the natural world we can draw conclusions about God's nature. But given how much evil there is in the world, what could we really conclude about God by looking at this evidence? We certainly cannot conclude that he is infinitely good and infinitely powerful. Just as the evidence available to us in nature is not sufficient to establish God's natural attributes (i.e. his infiniteness, his perfection, his unity, his incorporeality), Philo claims that the evidence available to us in nature is also not sufficient to establish God's moral attributes (i.e. his goodness and his will).
The problem of evil is one of oldest and most intractable problems in the philosophy of religion. It is traditionally presented in a challenge to the Christian conception of the deity. Throughout history, people have asked how it is possible to reconcile God's infinite goodness, wisdom, and power with the presence of evil in the world. Given the presence of evil, we must either conclude that God wishes to prevent needless suffering, but cannot, in which case He is not all-powerful, or we may admit that he does not wish to prevent evil in which case we may conclude that He is not infinitely good (or, alternatively, we can conclude that he both wishes and can prevent evil, but that he is not wise enough to know how to arrange the world so that there is no evil, in which case he is not infinitely wise). Many Christian thinkers have claimed in response that God could prevent evil but does not want to because that would not be the best thing to do.
Philo is not particularly interested in the problem of evil in its traditional guise as a challenge to the Christian conception of the deity. Instead he presents it as a challenge to the empirical theist's attempt to infer God's nature from the universe. But in the course of the discussion between the three men Hume does address the first, more famous challenge posed by the problem of evil. Demea, naturally, responds to the problem with the standard orthodox reply: we only think that there is evil in the world, because we do not understand how everything balances out for ultimate good. Cleanthes, however, points out that there can be absolutely no basis for this claim. We have no evidence whatsoever that all the evil balances out for ultimate good. Demea, though, would probably not be fazed by this objection: he would not care whether or not there is evidence for his reassuring faith that "all is for the best," for Demea is not interested in proving God from the evidence. He believes without evidence, and all that he cares about in this regard is that he can reconcile the presence of evil with his conception of God.
Philo also offers an answer to the traditional problem of evil. He appeals to the position that he has been pushing all along: we simply cannot comprehend God or his plan. So long as we do not try to compare God to man, Philo claims, we do not really run into a problem. Judged by man's standards of morality God certainly seems to fail; but there is no reason to believe that God's standards of morality are anything like our own. So long as we admit that we cannot comprehend God, we can allow that God's infinite perfection and the evil of his creation can be reconciled in some unknown way.