Why is the game industry using C/C++?
"Because they need the highest possible performance."
Why do they need that performance?
"To look better than the competition."
Why is looking better than the competition important?
"It sells better."
Why not do other things to sell better and get a better time-to-market with a slower language?
"Too risky."
And the entirety of console gaming has bought into ideologies of low risk, top-to-bottom. The systems are either underpowered or just plain difficult to develop for, the publishers impose boneheaded ideas, and the additional manufacturer requirements increase the costs, but the perceived benefits of a system with low piracy and high retail impact make everyone buy in, again and again. The burden always falls on the developer to suck up the worst excesses and ship something workable. And this in turn encourages a dogmatic developer ideology where one accepts "nobody ever got fired for buying IBM" type stuff because of perceived risk. C/C++ is just one of those things.
I'm inside this system now... and while I like the company and am satisfied with the job, I would love to see it all break apart. It's a nasty system and we get the short end of it.