The gospel is the power of God. However, that power is not in the magic of the words. It is rather that at the appointed time, the soil, or the ground that receives the gospel is prepared. In the elect this gospel takes hold as the soul is overshadowed by the Spirit of Christ, and the darkness that follows must be taken away by the gospel. It may be like in Acts ch 2 where Peter is preaching the gospel as the hearts are being prepared. It may be like Paul on the Road to Damascus, where he had heard the gospel in a previous time, but the conviction hits at the appointed time.
The fertile soil prepared by Christ will cause the gospel to take hold, repentance of unbelief to spring forth, and the beginning of the road toward perfection through the law of faith, the law of Christ, will have begun. This is not a sinless perfection, but an imputed perfection from faith to faith, which the elect are predestined to keep to the end.
As we have seen the Covenant Theologians taught that the law convicts of sin. They teach that Romans 7 is a saving conviction, when really it is the example of Paul as an unbeliever being condemned by the law for failure to keep the law. Whatever guilt that Paul felt was not strong enough to save him. Indeed, Paul said the law was weak and was unable to deliver him.
The sword of the Spirit, the word of God, word of life, word of gospel was the power that was strong enough to deliver where the law of Moses could not deliver. Below is a debate with Joe on a forum. I have quoted him here and have answered his arguments here regarding the Spirit's work of conviction through gospel alone:
A response to David Wayne at world theologica blog:
You are so right David. In fact, I would not want to be called a Calvinist because Covenant Theology is just the flip side of the legalistic coin. CT is on the front side and Dispensationalism is on the back side. Check out my website and I will show you exactly why I view CT as being the New Circumcision. And guess what David? Did you know that the Covenant Theologians watered down predestination? They did so by preaching law conviction. Even though Paul said that all people feel guilt about doing bad things, the CT's used that almost universal guilt to somehow bring people into "saving conviction". Of course they paid no heed to the author of the book of Acts, who revealed that the gospel convicted of unbelief after Peter preached in Acts ch 2! Amazingly the CT's rather gave everyone a chance to be part of the elect!! A true New Covenant Theology teaches that the law cannot convict, but only the gospel. You will also find this truth within the 1646 London Confession. And only the elect are convicted unlike those convicted by natural conscience, which of course is all of the human race! So, David, I stand for sovereign grace, and I find I cannot do so being a covenant theologian. And I find that most of the New Covenant Theologians reject gospel conviction as well. That way they can be Protestants, be a part of the New Circumcision. This is a really sad state of affairs David, but the will of God will ultimately prevail.