God uses Baptism to save—to give us forgiveness of sins and the gift of the Holy Spirit (Acts 2:38-39; 1 Peter 3:21). How can water do such great things? “Certainly not just water, but the Word of God in and with the water does these things, along with the faith which trusts this Word of God in the water. For without God’s Word the water is plain water and no Baptism. But with the Word of God it is a Baptism, that is, a life-giving water, rich in grace, and a washing of the new birth in the Holy Spirit, as St. Paul says in Titus, chapter three” (SC, Baptism, Third). It is the Word of God that we saw in the previous column and faith that makes Baptism what it is, just as Jesus said, “Whoever believes and is baptised will be saved” (Mark 16:16).
As Paul also said, “He saved us, not because of works done by us in righteousness, but according to His own mercy, by the washing of regeneration and renewal of the Holy Spirit, whom He poured out on us richly through Jesus Christ our Saviour, so that being justified by His grace we might become heirs according to the hope of eternal life” (Titus 3:5-7).
We call this baptismal regeneration. Many misunderstand this as a good work included with justification by faith since the Scriptures teach we are justified by faith alone (Romans 5:1). (They also conveniently ignore Christ’s words in Mark 16:16 that faith and Baptism go together and waste time in “irreverent babble” [2 Timothy 2:16] about whether or not it should be in the Bible since it’s not in all the manuscripts.) Yet Lutherans have never taught that baptismal regeneration is a work included with faith.
It is easy to discern what Lutherans believe if one simply reads our Confessions (the Book of Concord). Imagine that! Thus, what do the Confessions say about baptismal regeneration? First, as already listed above, baptismal regeneration is “a life-giving water, rich in grace, and a washing of the new birth in the Holy Spirit,” in other words, what Jesus says in John 3:5-6. In short, whereas evangelicals say “born again,” we say baptismal regeneration; the two terms are interchangeable. Luther brings this up again in the Large Catechism when he emphasises that the Word does the work of Baptism, which shows God’s name is in it. “And where God’s name is, there must also be life and salvation. Thus it is well described as a divine, blessed, fruitful, and gracious water, for it is through the Word that it receives the power to become the ‘washing of regeneration,’ as St. Paul calls it in Titus 3[:5]” (LC IV, 26-27).
If these aren’t clear enough, the Formula of Concord should definitely clarify the matter:
In the first place, the word regeneration (regeneratio) is used to mean both the forgiveness of sins for Christ’s sake alone and, at the same time, the succeeding renewal that the Holy Spirit works in those who are justified by faith. Then again, it is sometimes used to mean only the forgiveness of sins and that we are adopted as God’s sons. It is in this latter sense that the word is used much of the time in the Apology, where it is written that justification before God is regeneration [Ap IV, 72, 78, 117]… The words “making alive” have sometimes been used in a similar sense. For when a person is justified by faith (which the Holy Spirit alone does), this is truly a regeneration. In this he becomes a child of God instead of a child of wrath [Ephesians 2:3]. So, he is transformed from death to life, as it is written, “When we were dead in our trespasses, [God] made us alive together with Christ” [Ephesians 2:5]… [Regeneration] means that Christ covers all their sins (which in this life still dwell in nature) with His complete obedience. But despite this they are declared and regarded godly and righteous by faith and for Christ’s obedience (which Christ rendered to the Father for us from His birth to His most humiliating death on the cross [Philippians 2:8]).FC SD III, 19-20, 22; emphases mine
Too long, didn’t read? In short, baptismal regeneration is synonymous to meaning the forgiveness of sins and, therefore, justification by faith since He covers all our sins by applying His perfect obedience to us by means of water and the Word of God, that is, Baptism. By this regeneration of Baptism, it can properly be said that we are born again. Notice how the Lutheran reformers do not speak of baptismal regeneration as a work of man. The only work mentioned in baptismal regeneration is the perfect work of Christ applied to the unregenerate sinner to make him or her a regenerated (adopted) child of God. Through Baptism, then, you have been regenerated into new birth as a holy child of God and no longer an evil child of wrath (Ephesians 2:3) by the efficacious power of God’s Word.