Induction is a cognitive heuristic that we and many other animal species use to make choices and behavioral decisions.
As I noted earlier, or later, as it were, in regards to your statement, induction might be associated with instinct or memory, or natural, animalistic kinds of instinctual reasoning, but in my opinion, Popper and Einstein are correct that it plays no part whatsoever in the kind of human thinking associated with the scientific-endeavor.
It's a beneficial tendency because it grants us a mental model that corresponds to reality much more often than not.
Popper says that though it grants a mental model, with it alone, we could only act instinctually in relationship to that model. For instance, if two men are walking down a path and one notices that every bird they've passed has been black yellow and red, while his peer didn't even notice passing a bird, he could say, I'll bet you fifty-dollars the first bird we pass will be black yellow and red.
Popper points out two things in relationship to this inductive heuristic. First, though it seems like having passed say ten or fifteen black yellow and red birds means the next one will be black yellow and red, in truth, that's a mere prejudice that has no sound, factual relationship to truth. The next bird could be a damn Magpie as truly as it might be black yellow and red.
Next, Popper points out that nothing required, incited, or encouraged, the one man to notice and take account of the birds, nor to hypothesize inductively that the next would be the same as the last few. Induction doesn't make anyone do anything unless, perhaps, it's an instinctual proclivity to trust inductive inferences.
According the Popper, the man is likely to lose his money in the bet for trusting induction, and yet he will make up for it somewhere down the road for his non-inductive ability to hypothesize from his own downright ornery human logic.
For that reason, it has persisted as a feature of biological brains over the course of evolution. We can test and demonstrate the accuracy (and benefit) of induction. This isn't difficult. There is no need to call this a "placebo" or a subconscious denial of magic spirits.
The main idea is that the human mind parasites the mammal brain in the human body: that it's not fully subject to the limitations of the animal brain.
I know of very, very few atheists who believe in "metaphysical physicalism," which only sounds like an oxymoron for etymological reasons in the way you are choosing to describe it. It is essentially the belief in the absolute claim that "natural physical things are all that exist in reality." Another way of describing the same concept is "philosophical naturalism," or "ontological naturalism."
Virtually all atheists are uncomfortable making absolute claims about the fundamental nature of reality, because we don't currently appear to have any grounds for this kind of metaphysical knowledge. It is all merely speculative, and unjustifiable with our current tools of inquiry.
The well-educated atheists, like say Chomsky, would agree with your statement. But the garden variety atheist is usually a philosophical naturalist. Chomsky, on the other hand, said he doesn't see how anyone could be a materialist since to date we haven't found one morsel of actual material in the universe: it's all information packaged in a manner that some mammals interpret as solid matter. Human's should be the wiser.
To be a philosophical naturalist is almost as irrational as believing a god exists. I say "almost" because at least we can demonstrate that nature does exist. To go farther and say it is all that exists or can exist is not supported by any evidence. So yes, I would experience epistemological discomfort if I, as an atheist, had to try and believe this. That's why I'm a methodological naturalist, which involves tentative conclusions based on current available tools and evidence.
Popper and Einstein would probably fit the same mold you're creating for yourself. Which is to say that even though they refuted inductive logic, and admitted that aspects of human thought are miraculous so far as sound logic and science are concerned, nevertheless, this didn't lead them to theism.
It's that failing that I'm attempting to get my head around. How do you, Popper, or Einstein, not get theological when you see that the human mind is not fully a product of the natural world?
Your entire post is basically a straw man. "Look at this thing that an imaginary atheist believes. It's just as irrational as supernatural beliefs. Boy, do atheists have a bad epistemology!" In actuality, you're projecting your own epistemological failures onto us, then criticizing these failures. You're only harming yourself here.
I don't think you're correct here. We'd have to examine it further for you to convince me of it.
John