Anyway, baptismal regeneration is the concept that baptism actually does something concrete and is not merely "an outward sign of an inward faith" or however that goes. See this post in Ask the Pastor for a good explanation of original sin, the need for infant baptism and baptismal regeneration.
Well thinking about baptismal regeneration and listening to a podcast from Stand to Reason, a very Calvinist apologetics ministry that I like to listen to that tries to be rigorously logical, got me to pondering the fact that Lutheran Christianity is unique in its embrace of paradox. Calvinists and others try to force Christianity into a logical system, usually at the expense of the plain teaching of the scriptures on such things as baptism, the Lord's Supper, our need to "make a decision for Christ" and other things. This acceptance of paradox is actually one of the very things that attracted me to Lutheranism! In some ways it is a little like Zen with its Koans. They have "what is the sound of one hand clapping" while we have "simul justus et peccator" (we are both saint and sinner, never only one or the other, but always both), and the real presence of Christ's body and blood in with and under the bread and the wine, both are really there at the same time. There are more but I'll give you this excerpt from a longer article "Evangelical Catholics & Confessional Evangelicals, The ecumenical polarities of Lutheranism" by Gene Edward Veith.
The distinctive characteristic of Lutheran theology is its affirmation of paradox. Calvin and Arminius both constructed systematic theologies, explaining away any contrary biblical data in a rationalistic system of belief. Luther developed his theology in Bible commentaries, following the contours of Scripture wherever they led and developing its most profound polarities: law and gospel; Christ as both true God and true Man; the Christian as simultaneously saint and sinner; justification by faith and baptismal regeneration; Holy Communion as the Real Presence of Christ in material bread and wine.
Not only have Lutherans always affirmed both "evangelical" and "Catholic" ideas, their way with paradox also resolves issues that have divided Protestants. Calvinists insist on salvation by grace alone to the extent of double predestination; Arminians insist that everyone, potentially, can be saved, and so stress the utter freedom of the will. Lutherans stress grace above all, that God does literally everything for our salvation, dying on the cross, with his Spirit breaking into our lives through Word and Sacrament, the means of grace. But Jesus died for all, and potentially anyone might be saved. Lutheranism affirms the best of both Calvinism and Arminianism, while avoiding the exclusivity of the one and the potential Pelagianism of the other. Charismatics emphasize the Holy Spirit-so do Lutherans, finding that Spirit not in the vagaries of human emotion but even more tangibly as being genuinely operative in the Word and Sacraments. Lutherans are fundamentalist in their doctrinal rigor, while excluding separatism and legalism. Lutheran cultural theology affirms Two Kingdoms, preventing the secular from swallowing up the sacred, and the sacred from swallowing up the secular. This explains why Lutherans can seem both inwardly focused and free and easy, why they seem conservative yet apolitical, and why they often have beer at their church dinners.
Lutheranism-with its sacramentalism and liturgical worship synthesized with its biblicism and evangelical proclamation-might serve as a bridge between the various factions of Christianity. Of course, it is not that simple.
If Lutheranism represents an "evangelical Catholicism" (a term favored by many confessional Lutherans), its paradoxes mean that it is likewise subject to attack from every side. Evangelicals consider it "too Catholic"-making fun of what they consider its stiff formality, its old-fashioned music, and its ancient liturgy and, more seriously, questioning how Lutherans can say salvation is by faith if they believe in baptismal regeneration and being appalled at the way the pastor says when he gives the absolution that he forgives people their sins. Catholics and Orthodox lump Lutheranism with all other Protestants-in fact, Lutherans are the worst Protestants because they started the dissolution of Christendom.
Within Protestantism, Calvinists attack Lutherans for "not going far enough in the Reformation," for keeping papistical practices and idolatrous worship. Arminians attack Lutherans for not believing in the freedom of the will and for leaving the door open to anti-nomianism. Charismatics think Lutherans are "cold." Fundamentalists say Lutherans are strong on doctrine but weak on morals.
And, just as the Lutheran framework seems to invite attacks from every side, Lutherans counterattack everyone else. Lutherans condemn Arminians for not believing in predestination and Calvinists for believing in double predestination. Catholics and charismatics are considered alike in believing that the Holy Spirit reveals himself in human beings, apart from the Word. Fundamentalists are savaged for their legalism. In fact, many Lutherans do not see themselves as being Protestant at all.
The Lutheran synthesis is a baroque structure that can only be held together by a doctrinal rigor that constantly reinforces every point. Anglicans attempt a via media between Catholicism and Protestantism, which works through compromise, broad consensus, and a tolerance for differences. The Lutheran way, on the other hand, is one of polarities. Each pole of the paradox must be maintained and heightened. What Chesterton said in Orthodoxy of the paradoxes of Christianity is particularly descriptive of Lutheran theology: "We want not an amalgam or compromise, but both things at the top of their energy; love and wrath both burning." Christianity does not approach doctrinal issues, such as the nature of Christ or the moral status of a human being, in terms of the Aristotelian golden mean. Rather, "Christianity got over the difficulty of combining furious opposites, by keeping them both, and keeping them both furious."
Thus, Lutherans are very sacramental and very evangelical. Anglicanism, even in its high-church phase, has always been dismissed by continental Lutherans as merely another variety of Reformed Calvinism, its articles being so wishy-washy in not clearly affirming the Real Presence. Evangelicals are not evangelical enough, falling as they do into the trap of "decision theology" and moralism, not trusting God to accomplish literally everything that is needful.
As a result, Lutheran theology, though embracing in one sense the whole range of Christian spirituality, is nevertheless an entity unto itself, with its own spiritual disciplines that are quite alien to those of other traditions. Consider, for example, the way Lutheranism opposes the so-called Theology (or rather, spirituality) of Glory-with its pretensions of power, victory, and earthly success-with the Theology of the Cross, in which God reveals himself in weakness, defeat, and failure. Or the Word of God, not merely as a sourcebook of information, but as a sacramental means of grace. Or the way God hides himself in what seems to be his opposite, in the material elements of the Sacraments, in humiliation and defeat, in what seems most secular and nonreligious. Or the exhilaration, under the gospel, of Christian freedom.