Marcus Terentis Varro - otherwise known as Varro Reatinus - was a first century BC Roman philosopher, satirist and linguist who was a contemporary and correspondent of such well-known Roman luminaries as Cicero. His only surviving complete work is on agriculture ‘Rerum Rusticarum’, but we have mentions of Varro's thought in other sources.
One such mention - from Saint Augustine's ‘City of God’ - points to Varro's views on the subject of the jews.
I quote:
'He says, also, that the ancient Romans, for more than a hundred and seventy years, worshipped the gods without an image. “And if this custom,” he says, “could have remained till now, the gods would have been more purely worshipped.” In favour of this opinion, he cites as a witness among others the Jewish nation; nor does he hesitate to conclude that passage by saying of those who first consecrated images for the people, that they have both taken away religious fear from their fellow-citizens, and increased error, wisely thinking that the gods easily fall into contempt when exhibited under the stolidity of images.' (1)
Now the above seems like a pro-jewish rendering of Varro: doesn't it?
Well, the problem is that Augustine has every reason - as he himself frequently wrote against the jews - to style Varro's views as being more pro-jewish than they in fact would have been. This can be demonstrated by pointing out that Varro referred - according to Augustine - to the jews 'among others' as proof of his opinion about the irreligiousness caused by the worship of images (if we are to believe Augustine's rendering of his argument).
That means that Varro was making a general religious point not one specifically in favour of the jews, but rather one which used the jewish worship of the air as it was often styled as an example that piousness towards a deity is better served if one doesn't expect to see that deity in the flesh (which would have likely been the thrust of Varro's argument). Nor was the jewish example alone, but rather Varro used the jews as but one of several examples (as Augustine tells us) to suggest that piety is better served by iconoclasm than icons.
Nor is Varro's argument referring to the jews positively as it refers to their lack of idols as being a device to increase piety towards their deity not that their religious beliefs are themselves a wholesome or positive train of religious thought, but rather that they sincerely believe them more due to a lack of religious images (which is a value neutral position).
Augustine stresses the allegedly pro-jewish nature of Varro's argument in large part because early Christianity often took a stridently anti-Judaic position - but not an anti-Semitic one I might add - and the jews would have been far more recognizable and real as religious opponents to Augustine's contemporaries than say the Orphic religion or the religious principles of Pythagoras (which Varro probably used as examples). Thus, Augustine styles Varro's argument as pro-jewish because jews were the subjects of attack for many of his other arguments so by associating Varro with the jews: he implicitly ascribes to Varro the opprobrium that he uses against the jews without having to carefully examine the difference between Varro's arguments and those used by the jews.
Essentially Augustine is engaging in character assassination by ascribing Varro as being pro-jewish: nothing more, nothing less.
In summary then we can see that Varro's comment - as quoted by Saint Augustine - is not pro-jewish - as it has often been taken by some jewish writers to be - (2) at all and rather is simply the use of a jews as one of several historical/current examples to prove a general point about piety. It is not a statement in favour of the jews, but rather a statement in favour of iconoclasm and the perceived purity of religious worship that that brings.
References
(1) Aug. Civ. Dei. 4:31.2
(2) For example: Max Radin, 1915, 'Jews among Greeks and Romans', 1st Edition, Jewish Publication Society of America: Philadelphia, pp. 234-235