What we see is that even the best of the city of man cannot hope to cling to virtue, and is ultimately deceived. Scipio Nasica, already admitted by Augustine to be the best of the ancient Romans and the defender of public morals, was instrumental in introducing the worship of the Magna Mater (Cybele, or the "Great Mother") into Rome. [If you're reading the Dodds translation, he cites Cicero's De Natura Deorum. I believe this is an editorial error, and that Livy's History is the correct source.] The fact that the worship of this goddess has descended into such horrendous abuses simply proves that there can be no moral growth in the city of man. Scipio Nasica was deceived, for "her intent was to puff up this high-souled man by an apparently divine testimony to his excellence, in order that he might rely upon his own eminence in virtue, and make no further efforts after true piety and religion, without which natural genius, however brilliant, vapors into pride and comes to nothing."
In other words, all false religion does is reminds us of our own inherent excellences, rather than turning us to "true piety and religion." And so we eventually lose even those gifts of common grace because we never come to the truly saving grace that alone can preserve the fruits of "natural genius."
I think this is an interesting passage. It seems to be structured something like this:
1) Show me where you pagans learn about holiness from your gods.
2) You claim that the elite initiates into your mysteries are given true moral instruction, but
3) we all know how you really live--and it's not moral at all.
4) Where, then, do you learn how to live the way your writers (in this case Persius) tell you to live?
The obvious immediate answer is that the pagans do have good moral instruction, since they have writers like Persius telling them how to live. But I think the argument is more subtle than that. The point is not so much that the pagans have never been taught morality--they know quite well the difference between right and wrong. The point is that the pagans can nowhere demonstrate either 1) that such teaching comes from the gods at all, rather than just from men, and 2) that the followers of the gods actually follow said teachings.
Christians, on the other hand, despite all our failures can hold up both the teachings of Scripture and the lives of Christians as evidences of instruction unlike anything else in the world.
But what about those philosophers, who aren't gods but perhaps have good things to teach us? It is certainly true that, by God's grace, they have come to some true conclusions about ethics, physics, and logic (the three traditional categories of Hellenistic philosophy). But, it is also true that human nature is so depraved that we'd rather engage in the evil rites of the false gods than hear even the smidgens of truth available in the philosophers. We see this even in how we choose our gods--were we better we would at least choose to worship Plato, who had a tiny bit of the truth. Since we are not, we choose to worship those 'deities' which reflect the base aspects of our nature that we love most.