We are fighting today for costly grace. Cheap grace means grace sold on the market like cheapjack's wares. The sacraments, the forgiveness of sin, and the consolations of religion are thrown away at cut prices. Grace is represented as the Church's inexhaustible treasury, from which she showers blessings with generous hands, without asking questions or fixing limits. Since the cost was infinite, the possibilities of using and spending it are infinite.
Cheap grace means grace as a doctrine, a principle, a system.
An intellectual assent to that idea is held to be of itself sufficient to secure remission of sins. The Church which holds the correct doctrine of grace has, it is supposed, ipso facto a part in that grace. Cheap grace therefore amounts to a denial of the living Word of God, in fact, a denial of the Incarnation of the Word of God. Cheap grace means the justification of sin without the justification of the sinner. Grace alone does everything, they say, and so everything can remain as it was before.