At the close of the last liturgical year, Pope Benedict XVI made a startling proclamation: "Luther’s expression sola fide is true if faith is not opposed to charity, to love" (Wednesday Audience, Nov. 19, 2008). At first, this statement might seem to collide with Trent: "If anyone says that the godless are justified by faith alone . . . let him be anathema" (Trent, VI, canon 9). Again, "For faith, unless hope and charity are added thereto, neither unites one perfectly with Christ nor makes one a living member of his body" (Trent, VI, ch. 7).The gist of Mally's article (and it is a detailed, analytical article) seems to be that there are differences of expression, emphasis, and insight here, but not such differences as would constitute contradictions. Luther's expression "justification by faith alone" can be understood in a Catholic way, for example, if faith is "formed faith" -- faith formed by charity.
Yet Malloy acknowledges that problems remain in accepting Luther's own formulations:
... Luther rejects the idea that at the baptismal moment of justification a man becomes truly just interiorly (LW 32:229). For Luther, the believer is always totally righteous and totally sinful. Hence, despite the beginnings of sanctification, justification itself must be simply a declaration of forgiveness and an "imputation" of righteousness (LW 26:223-236, 1963 ed.). He must, therefore, reject Catholic teaching. Luther declares, "If love is the form of faith, then I am immediately obliged to say that love is the most important and the largest part of the Christian religion. And thus I lose Christ" (LW 26:270). Luther even resorts to a curse: "Let that expression ‘faith formed’ be damned!" (LW 26:273, see also LW 27:38; on this curse, see Joseph Cardinal Ratzinger, Church, Ecumenism, and Politics, 104-11).Nevertheless, there are points at which Luther's emphasis serves as a needed corrective to certain distortions in the otherwise valid notion of merit among some Catholics. Malloy writes:
... Luther—and the Formula of Concord after him—excludes charity from the justifying role of faith. Luther consequently deflates the dramatic tension that constitutes our "time of decision for love" on earth (Phil 2:12ff; 2 Tm 4:7-8). Catholics cannot accept these teachings of Luther, which contradict the Gospel (Rom 1:16ff) as Catholic faith reads it.
Despite every effort at ecumenical reconciliation, a difficulty remains; an important obstacle must be overcome. As Benedicts shows, Catholic terminology is flexible. It is the reality of the mystery that must be upheld. Provided that justifying faith (Rom 3:28) is understood as a compact expression for faith, hope, and charity, Catholics do profess that faith alone justifies (1 Cor 13:13; on a history of the reception of Romans pertinent to this point, see Thomas Scheck, Origen and the History of Justification).
There is no question, many of the points Luther made were on the money. Among these are the following: Some members of the Church were corrupt; God’s grace is totally free (Eph 2); sin still lies in wait even for the just person (Rom 7); Christ is presently a high priest interceding for sinners (Heb 4-5); good deeds are expressions of gratitude for salvation, etc.[Hat tip to J.M.]
... Above all, our eyes should fall on Jesus Christ. May these papal audiences be as oil upon the head, running down the beard (Ps 133:1ff), so that Catholics may humbly profess the fullness of the faith they do not own, so "that they may all be one" (Jn 17:21).