The following note was in answer to a question someone asked me regarding the death of our Lord: "Was Jesus punished for our sins on the cross?" The implications of this question are far reaching and essential for us to understand.
The problem with losing the penal-substitutionary death of Christ is that we lose the power of the Gospel to save. Why else do you think Paul said, "For I determined not to know any thing among you, save Jesus Christ, and him crucified." (1 Corinthians 2:2)? Because "the preaching of the cross is to them that perish foolishness; but unto us which are saved it is the power of God." (1 Corinthians 1:18)
The power to save sinners is found at the cross. Paul wrote in Romans 3:23-25: "For all have sinned, and come short of the glory of God; Being justified freely by his grace through the redemption that is in Christ Jesus: Whom God hath set forth to be a propitiation through faith in his blood." The moment a sinner puts His faith in the blood of Christ (ie. the sacrifice of Jesus Christ for His sins on the cross) he is forgiven because the blood of Jesus propitiated the judgment that his sin had incured. Thus the wrath that before hung over the head of the sinner is gone through faith in the atoning blood which propitiates that wrath. Justice was served at the cross; pardon is obtained through faith on that basis. That's the power of the Gospel: the cross.
But if you lose that, the 'power-point' of the Gospel must shift from the cross to the individual's "repentance". If Christ's death was not substitutionary, then it doesn't matter if a sinner believes in the blood... that cannot save him because there is no longer any power in that blood. "Faith in the blood" is no longer the power of the Gospel... repentance is. Only when a sinner turns from all sin is He justified. So the Gospel becomes: "Stop sinning!" rather than, "Christ died for our sins; believe."
Of course, there is no power in that kind of a gospel, and furthermore, since no man can stop sinning without the indwelling of Christ, there's no hope in it either. "For without me ye can do nothing." (John 15:5) All their repentance is filthy rags in God's sight, until they repent of the one thing they continue to flatter by their false repentance: self. Self-wisdom, self-righteousness, self-sanctification, self-redemption all must be exchanged for Jesus Christ (1 Corinthians 1:29-31). The only offering acceptable to God by the sinner is Jesus Christ. How dare we try to bring God "the fruits of the earth" from the "sweat of our brow" when God has provided the Lamb for the sacrifice?!
We can argue and argue, but the things of God are revealed unto us by the Spirit of God (1 Corinthians 2:8-14).
That no flesh should glory in His presence,
Your brother in Christ,