Why Can’t Humans Acknowledge Monster Rats?
If Squealer needing to destroy the human species was understandable, then Cantus Users needing to keep a hierarchy of two races is also fathomable. In the end, if they started viewing Monster Rats as the same as humans, all Cantus users would die out. Why, you ask? Depending on genetics, the sensitivity of the person, and the level of conditioning they had, many villagers might die a retroactive Death of Shame if they acknowledged Monster Rats as an extension of their “kind.”

As a genetic response, Death Feedback isn’t supposed to be triggered by killing any creature with 50% or less human genes. Monster Rats started as humans, but now only 50% of their genetic makeup is the same as what makes up the “new humanity.” That being said, we’ve seen that psychological conditioning can change what triggers Death Feedback. If a human is raised to believe that Monster Rats are their kind, then killing Monster Rats, but not humans, will activate the response. Consequently, Cantus Users who recognize both humans and Monster Rats as their kind will die if they try killing a member of either species.
Suppose Saki made all the surviving villagers acknowledge that Monster Rats are their “kind,” too. Even if there’s no retroactive Death Feedback, the people and their descendants would suffer the Death of Shame if they ever killed Monster Rats. Why exactly is that a problem? Well, it puts the humans back to where they were before the creation of Bakenezumi. The Cantus Users wouldn’t be able to fight back at all in the event of a conflict or a war. In no time, the roles would be reversed, with Monster Rats becoming the dominant species because of their advantage of being able to kill humans (and any members of their own kind that side with humans). Cantus Users would be driven to extinction.
On a related note, humans and Monster Rats are actually not “the same.” They are equals in terms of intelligence, depth of feeling, and complexity. They are equals in terms of deserving the same civil rights. But in a technical sense, Bakenezumi DNA has 50% or less commonality with that of Cantus Users. Monster Rats look beastlike, and have different instinctive or natural social orders. It might have been easy for the Robber Flies and their allies to adjust to harming the colony queen, but only half the Bakenezumi in the Kanto region joined Squeera. The other half aligned with Kiroumaru and the traditionalists.
Inexcusable Cruelty

What about treating the Monster Rats as their own species, but one deserving of respect and rights? That would be the morally correct thing to do. That’s why the humans are so wrong. Earlier I said there were not many evils in Shinsekai Yori that are not somewhat justifiable. This is the one large exception. Why has nobody thought of the idea above, to view Monster Rats as their own species, but not enslave them or control their populations? Perhaps this occurred to Saki after the Monster Rat Rebellion, but someone should have thought of it much sooner.
There are reminders below in case you’ve forgotten the many ways in which the Cantus Users oppress the Bakenezumi indefensibly.
Bakenezumi are subject to at least eight forms of subjugation. Here are the first four. 1) They are overseen and unofficially governed by humans despite being promised autonomy. Each colony must have at least one representative who can speak and read the human language, complete required forms, and interpret as needed. 2) The humans interfere in the conflicts of Bakenezumi, demanding impractical permission forms and putting in danger the colonies which need to act quickly to be safe. 3) It’s likely that some form of information control is used on the Monster Rats to make sure they don’t become too educated or powerful.

4) Registered Monster Rats must agree to whatever colony name the humans give them, and they are exclusively named after insects. 5) Every member of a registered colony must have their head tattooed with the name of their colony; refusal means certain death. 6) Monster Rats must take unpaid labor jobs that humans are much more capable of doing. Required to the dirty work of the Kamisu 66 leaders, they also kill human children and outcasts deemed problematic. 7) The SSY anime implies there are various punishments for Monster Rats who are verbally defiant, violent, or who fail to complete orders or requirements. 8) Cantus Users are free to annihilate an entire colony of Monster Rats if they wish.
According to the humans, eliminating entire colonies only happens as the “worst possible penalty.” Yet, according to the oppressed Monster Rats, humans can and do wipe out their colonies for any reason. Given that people like Koufuu Hino are in positions of authority, it’s likely that the Monster Rats are closer to correct. For more detail, know that a special force within Mutant/ Exospecies Management is in charge of wiping out Bakenezumi colonies who have earned the punishment. They also destroy unregistered “foreign species.” Inui, a man seen in episodes 21 to 23, is part of that special force. The Monster Rats call them “Shinigami” or “Death Gods.”
Consider as well Squeera’s penalty for inciting the rebellion and being defiant on trial. His sentence is the worst possible punishment and is called “The Infinite Hell.” It involves subjecting the brain to the maximum possible level of pain while using Cantus to heal the victim or at least keep them alive to suffer more. There are probably numerous mechanisms used for causing physical agony. One way is to implant in the victim’s flesh a parasite which slowly and excruciatingly eats away their body. “Infinite Hell” is supposed to continue indefinitely. While he suffers for months on end, Squeera is put it a large glass jar and displayed in a museum.

As you can see, the humans rule brutally and tyrannically over a species that is equal to them in sentience and brainpower.
Species Survival and Understandable Characters
Viewers may wonder, over the course of the show, if they should be on the side of the Cantus Users or the side of the Monster Rats. Similarly, some ask, “Which side was right in the war between Cantus Users and Monster Rats?” The answer is the same for both questions. Both sides are logical and trying to preserve their species. One isn’t more correct than the other.
Every so often, viewers are driven away from SSY because they think the show is “on the side of the humans.” Actually, From the New World’s story is told from the point of view of a human—Saki—but it doesn’t suggest that the humans are always right. In fact, much of the series content exists to show how unethical humans can be. That, and it shows how flawed social order usually is.

Squealer saw that humans and society were twisted, and to deal with it, he used mass violence in the form of a bloody rebellion. He couldn’t accept how things were, and that’s justified. Saki also saw the evils of society and human nature, but she dealt with it by being coolly practical and not hyper-moralistic. She embraced her place in the crooked culture of Kamisu 66, seeking to avoid any major conflict while slowly bringing change from within the system. That’s also justified.
It’s true that “Squealer did nothing wrong,” in the sense of no wrongs that were unwarranted. In that case, it’s also true that Saki did nothing wrong, Kiroumaru did nothing wrong, and Tomiko did nothing wrong. All of them have some fair points, and are doing what they think is necessary to preserve their species. Each of them possesses evil in their hearts, too, and act reprehensibly. Whether you think they are right or wrong, these characters are all understandable.