@Mega Birb Not if those terrorist actions are directed toward the enemy. Psychological warfare affects more than just the individuals involved. Tales of the American 'Death Cards' spread throughout the Vietcong ranks, and instilled fear, particularly of the American Air Cavalry. Even Vietcong who had never seen an American plane heard about the Death Cards.
The Death Cards read: Surrender or Die like the others/ The American Army is here to kill every last one of you/ Surrender now and save your family. Fight and you will all suffer./ etc.
Britain used Psywar in WWI to affect German troops' morale, making them believe that their own government was lying to them about a number of things, as well as screwing up the numbers of casualties in battles.
Atilla the Hun catapaulted the heads of dead enemies into beseiged cities, both to terrify them to surrender, and utilize the rotting flesh as a bioweapon.
PsychWar is possibly the most effective tactic an outnumbered force can use to attain victory. That fear just encourages further victories.
Turians, I'm sure have their own history of Psywar.
Cerberus is well known for their Psychological tactics, from utilizing Thresher Maws' natural feeding instinct to destroy an Alliance base, to hiring Commander Shepherd, knowing his enemies would associate him and his reputation from then on with Cerberus, at least, to a point.
EDIT:
@SgtEasy, I'm working on an Ellis mission wherein he discovers that Cerberus is under new command, and vows to find and destroy their new leader, for completely personal reasons. Alliance profit, however, would be enormous from this mission, including Cerberus hardware, information, potentially weapons and armor, though that remains to be seen. Hopefully, Big Dog over there is cool with it, or has ideas to add.
EDIT 2:
@Mega Birb, totally just realized Turians have no sense whatsoever of Psychological Warfare. They're straight-up fighters, overwhelming an enemy in terrifying force. I totally get it. That having been said, maybe Sicaria will learn a little something from our resident straight-jacket.
EDIT 3: Holy shit, these edits. Turians also don't seem to like military risk. I'm betting Sicaria/Tiberius will never understand fully why Ellis does what he does in combat. I'll edit my plan for the loyalty mission to fit.
EDIT 4: Wow, honey mustard is really good when you dip pretzel sticks in it.
EDIT 5: I guess I should tag the necessary parties here:
@BlackSam3091,
@Arcarius,
@MrDidactEDIT 6: You know what, let's tag everyone:
@Rithy,
@Dervish,
@MechonRaptor,
@AquaAzura,
@DarkFey,
@Silver Fox,
@The Spectre,
@Poohead189,