1. Blessed are they whose iniquities are forgiven. This is at once in opposition to the hypocrites, who do not need forgiveness and, like healthy people, have no use for a doctor. For they do not think they have iniquities but rely on themselves as righteous and do not eat with the tax collectors and sinners, because they are not like other people (cf. Luke 15:2; 18:9 ff.). So the Pharisees rejected Christ, who bears the sins of the world, because they have none. And they say, “Are we blind?” And He said to them, “If you were blind, you would not have sin; but now that you say: ‘We see,’ your sin remains” (John 9:40–41).
Let us hear, then, what the line of argument is here. No one is blessed except the one whose iniquities are forgiven. Therefore the corollary is: No one is without iniquity, no one is not a child of wrath, and so he needs to have his sins forgiven. But this happens only through Christ. Therefore no one will be saved on his own, but through Christ alone. And this is also the argument of blessed Paul’s entire Epistle to the Romans, to which almost all the words of the epistle speak, as is clear to anyone who looks into it. For he says (Rom. 1:18, 17): “The wrath of God is revealed from heaven”; again: “The righteousness of God is revealed, etc.” The meaning is this: No human being knew that the wrath of God is upon all men and that all are in sin before God, but through His Gospel He has revealed from heaven both how we may be saved from that wrath and by what righteousness we may be set free, namely, through Christ.
Luther’s works, vol. 10: First Lectures I