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The conversation turns to an incident Grigory heard in town. A Russian soldier on the borderlands had been caught by the Asians. When he refused to reject Christianity, he was flayed alive.
Fyodor jokingly remarks that the soldier should be proclaimed a saint and his skin sent to a monastery to be worshipped. Grigory, who is quite devout, frowns.
Then Fyodor notices that Smerdyakov is smiling and asks him to explain himself. Smerdyakov asserts that if he were in the soldier's shoes, he would have renounced Christianity before the Asians asked him to do so. Then he wouldn't have blasphemed in rejecting God.
Fyodor loves Smerdyakov's twisted logic, but Grigory is furious. Smerdyakov slyly notes that not even devout Grigory has faith enough to move mountains.
Fyodor enjoys Smerdyakov's argument as a great example of Russian faith, and he prods Ivan and Alyosha to agree with him.