Anselm had already emphasized that Jesus Christ's death was the ultimate penance; the satisfaction for sin, and Luther sought to restore this to centrality. Reacting to the many systematic abuses of what may or may not have been well-intentioned procedures, Luther rejected penance, indulgences, confessors, and purgatory in favour of personal reception of Christ's "happy exchange" in personal Bible reading and prayer as well as corporate acts of remembrance and preaching.
The idea was that when Christ forgave and asked us to forgive he meant it for all of us, no matter what. Anyone could speak words of forgiveness to anyone. The point was not to have it regulated but to have it proclaimed and received over and over again, so that the power of forgiven-ness was new every morning and the freed life was an ongoing encounter with Jesus.
I assume you know about the Reformation. The Catholic church cleaned up the systematic abuses, by and large, but by then Protestantism had become a force of its own. These Protestants continued to face many of the same tensions surrounding forgiveness and the Christian life, but with Bibles in every hand and a world exploding in something called the Enlightenment, found new-ish ways of addressing them.
Within this Enlightenment, at least one person bears mentioning here. Immanuel Kant was one of a wave of new thinkers who was emphasizing the autonomy of the individual as a rational agent, thus calling into question the idea that anything could be accomplished "vicariously" and certainly discrediting authoritarian systems of penance and absolution. As you might imagine, this fed the fodder for those who, like those 7th century Irish missionaries, made penitence radically personal and applied it with rigid devotion. Groups like the Pietists and the Puritans and (insert the name of the church you probably went to here).
The Enlightenment made way for such modern thinkers as Marx and Freud---who defined all human action in terms of social and psychological dynamics respectively. Since then the social, political, philosophical, psychological and religious theories regarding guilt and forgiveness have abounded. In their wake, revolutionaries (and those otherwise optimistic about the advantages of social tinkering) have turned attention from the need for forgiveness by urging humanity toward the utopian possibilities where, essentially, forgiveness would no longer be necessary.
Of course, the frequent disappointments in this regard have caused modernity's self-assurance to bleed into post-modernity's deconstructionism. Now its a hodge-podge: Some continue forward on the myth of human progress and a good many others are wondering again about the practical wisdom of some sort of forgiveness as a societal and personal necessity.
For the last few decades forgiveness has been front and center in both large-scale, powerful forms such as the South African Truth and Reconciliation Commission headed by Desmond Tutu, and in small-scale, trivial forms such as the apology of Michael Richards on David Letterman or the now-common press conference apology-scene where the latest unfaithful politician tries to save some face (i.e., shorten the life-span of the story in the news cycle).
Western Christians to varying degrees have become wrapped up in all of these developments, while continuing (again to varying degrees) to emphasize the importance of forgiveness. In the evangelical protestant church, of course, the same old ancient problems have kept surfacing and resurfacing.
In the face of a lame kind of Christianity where forgiveness was a license to do whatever one wanted, Dietrich Bonhoeffer railed against "cheap grace" and reminded people of the cost of their freedom. Thus, church dramas and musical repetition were born. Dramas from the Ragman to The Passion of the Christ have each in their own way enabled church-goers to pay a sort of emotional penance, restoring their sincerity and resolve to do better next time, gratefully.
In the face of a legalistic, in/out kind of Christianity so prevalent in the modern era, Paul Tillich emphasized forgiveness as the "acceptance" which overcame the alienating powers of sin on persons and society. Churches occupying a come-as-you-are and stay-as-you-like posture have of course become more common than shopping malls, and quite comparable for their feel-good convenience.
Forgiveness has taken many forms, both in the church and out of it, to the extent that one cannot be too sure what is being talked about anymore. Is forgiveness a capitalism-enabling tolerance which allows individuals to operate autonomously and interact at will? Is it a blanket absolution which enables one to live and grow at one's own rate, free from the nagging problems of guilt and fear? Or, conversely, is it a luring promise used like a carrot on a stick to perpetuate the straighten-up-and-fly-right ethos of guilt and fear?
Furthermore, is forgiveness done more for the sake of the forgiver or the forgiven? Is it a personal, private thing or a social dynamic? Is it about avoiding punishment and escaping consequences or is it about a new life that is supposed to be effected? Is it a done-deal we live from of or is it a future event we live toward? Is it merely a ticket out of hell and a ticket to heaven or does it have to do with earth as well?
These questions and more like them have been the subject of many studies (although not as many as they deserve) and will continue to be, both in and out of the church. My own dissertation is hoping to discover what Karl Barth may have had to say about it. I suspect there are some good aftershocks to be felt in this regard from the theological seismic event of his Church Dogmatics. Who knows, maybe in there somewhere is a vision for a neo-Orthodox church that emerges from the rubble of modernity without simply being the tail wagged by the dog of postmodernity? (How's that for mixing metaphors?)
Regardless, there you have it: My interpretation of the history of Christian forgiveness. On one hand maybe kind of discouraging (did you realize something as simple as forgiveness could be such a hornet's nest?). On the other hand, maybe sort of encouraging (after all, there are no new problems under the sun). Either way, I continue to find my attention drawn and my eyes fixed on the narrative that has been playing out in time:
For there at the center of it all moving forward with a life of its own---in spite of many abuses, mistakes, and misconceptions and at the heart of many revitalizations, corrections, and fresh starts--there continues to stand the perpetually startling event of Jesus Christ.