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For the Catholic Church, “by grace alone” means that grace is intrinsically, constitutionally, and necessarily linked to the sacrament, and thus to the Church that administers it.
Many commentators with good intentions, even on the evangelical side, have rightly given attention to what seems to be the heart of the 1999 Joint Declaration on the Doctrine of Justification (JDDJ) signed by the Roman Catholic Church and the World Lutheran Federation. No. 15 solemnly says:
By grace alone, in faith in Christ's saving work and not because of any merit on our part, we are accepted by God and receive the Holy Spirit, who renews our hearts while equipping and calling us to good works.
If read out of context and in a theologically naïve way, this sentence could be a relevant and pointed summary of the biblical message concerning the mode of justification (by grace only and not based on merits), the means of justification (by faith alone), the grounds of justification (the saving work of Christ), and the consequences of justification (divine adoption and the gift of the Holy Spirit, the renewal of the heart and the activation of the Christian life).
However, every sound exercise in theological hermeneutics, including the reading of the documents of the ecumenical dialogue, must take into account the immediate and more general context, the meaning of the words used, and the consequences of what is being claimed.
Taken out of context, No. 15 would make much sense from an evangelical perspective. Yet it must be considered as an integral part of the JDDJ and therefore must be understood in relation to the whole document.
Presenting the various aspects of the doctrine, the Catholic and Lutheran Churches agree on a sacramental understanding of grace. It is this sacramental framework that qualifies the reference to the expression “by grace alone” contained in No. 15.
Together, in fact, they declare that “by the action of the Holy Spirit in baptism, they (the sinners) are granted the gift of salvation” (No. 25), thus undermining the idea that it is only by grace that God saves sinners through faith alone.
Lutheran theology, with its theology of regenerational baptism, actually runs this risk. Later, in No. 28, the JDDJ states (always with both parties affirming this together) that “in baptism the Holy Spirit unites one with Christ, justifies, and truly renews the person”.
It is not surprising, however, that the Catholic clarification on this point forcefully underlines that “persons are justified through baptism as hearers of the word and believers in it" (No. 27).
On the one hand, then, JDDJ wants to affirm the importance of the declaration of the righteousness of God received by faith. On the other, though, it reiterates the need for sacramental action through the mediation of the church as essential for justification and, therefore, for salvation.
The Catholic point is further reinforced through the claim that Catholics hold that the grace of Jesus Christ is “imparted” in baptism (No. 30). According to this view, grace is not received by faith alone, but is granted by God through the Church that administers it in baptism.
This statement cannot be reconciled with the view according to which salvation is by grace alone apart from works, even sacramental ones. So for all the good intentions expressed and the admirable effort in dialogue, the result is below expectations and beyond an obedient adherence to the biblical Word of God.
In contemporary Roman Catholicism we see a total consistency with respect to the traditional doctrine, that is, that justification occurs at baptism by a sacramental act.
Stretching Trent Rather than Reforming Rome
For the Catholic Church, the “by grace alone” of No. 15 means that grace is intrinsically, constitutionally, and necessarily linked to the sacrament, and thus to the Church that administers it and the works implemented by it.
In this view, salvation cannot be by grace alone, unless “by grace alone” is understood as the same grace being organically incorporated into the sacrament of the Church. We are evidently in the presence of a different concept of grace.
In JDDJ there is an attempt to re-describe this theological understanding of salvation in language that looks like the Lutheran one (which the Catholic Church appropriates through the use of such expressions as “by grace alone” of No. 15 and the recognition that works “follow justification and are its fruits” of No. 37).
However, this new description does not give the impression of changing the theology of the Council of Trent (1545-1563), according to which grace is sacramental and seen inside of a synergistic dynamic of the process of salvation.
This understanding of grace appears to be more in line with the Catholic heritage of the Council of Trent, in an updated form, than with classic Protestant theology. In this sense, JDDJ is a clear exercise in an increased “catholicity” (i.e. the ability to absorb ideas without changing the core) on the part of Rome, which has not become more evangelical in the biblical sense.
You may want to read my comments on the endorsement of the World Communion of Reformed Church to JDDJ, posted on the website of the World Reformed Fellowship.