You’re describing so-called replacement theology. That’s the heresy that won’t die, at least yet.
First of all, "replacement theology" is not heresy. It's traditional chrstian doctrine and always has been. Only the most Biblicist of Fundamentalist Protestants reject it.
Secondly, it's not simply the idea that the church has superseded Israel (G-d forbid!). It's the identification of chrstianity with a specific ethno-culture, ie, Europe, and the treating of Europe and Europeans as a sort of "chosen nation" of chrstendom. As the notorious Hilaire Belloc put it, "Europe is the faith and the faith is Europe!"
But it's not just Catholics who think that way.