Presbo,
First, let me state that the historically orthodox Lutheran understanding of the distinction between Law & Gospel is not fundamentally different from the historically orthodox Reformed position. The Law consists of the commandments of God, which reveal our duties toward God & toward our fellowman. It has three uses:
- First, to show us our sin (pedagogical);
- Second, to restrain evil in society (civil); and
- Third, to teach us how to live a life pleasing to God (didactic).
(Lutherans would reverse the order of the 1st & 2nd uses.)
It is important to note that the Law is never a means or way of obtaining salvation. The Law has to do with justice, & it never gives grace; the Gospel has to do with grace, & it supercedes justice.
For Luther & the Lutherans, the first or pedagogical use of the Law is of primary importance, because it shows us our need for the Gospel. For Calvin & the historical Reformed tradition, greater emphasis is laid on the third or didactic use of the Law. The Law is the way by which we come to know the perfection of Christ, and thus it is through obedience to the Law, by the power of the Holy Spirit, that we become sanctified & conformed to the image of the Savior.
It mostly boils down to a difference of emphasis, as far as the historical orthodox positions of the two camps go.
However, especially in recent years, many Lutherans have questioned whether Luther himself allowed for the third use of the Law. They posit a stong opposition between Law & Gospel that they find no positive role for the Law in their own lives, to the point that Law becomes strictly a negative thing which convicts us of sin. This idea has been creeping into Reformed circles as well -- so much the worse, as it can only lead to practical antinomianism.
