I love how deadpan the bug report is: Actual results: All files are deleted on the machine. Expected results: Squid is restarted. Not many details yet but it sounds similar to the Steam bug [0] from last year. [0] https://github.com/valvesoftware/steam-for-linux/issues/3671
I would bet on the issue being in the init script itself rather than squid. (I'm assuming squid doesn't run as root by default in rhel) If that's true then it's another point for more sane process managers (upstart/supervisord/systemd/...)
rm -rf "$STEAMROOT/"*