Pope Benedict nee Ratzinger, well-known as a hard-liner, caught a bunch of flak for saying that Protestant churches aren't churches at all. (Reuters) But it wasn't he who said that Protestants are going to hell. It's Vatican II (1962-1965) that defined Protestants as not true Christians. Benedict was merely explaining why, for the last 40 years, Catholics have stopped referring to Protestant faiths as “churches.”
The Pope says he's the leader of all Christians. But only half the world's Christians are Catholics. What about the Orthodox churches, who deny the Pope's primacy? According to Benedict, they are defective churches, but churches in the divine sense. The saving power of the sacraments in Orthodox churches actually comes from the Catholic Church. And what about Protestants, who practically defined themselves as anti-papist? They aren't Christians. Their religious communities don't count as part of the universal church. Thus, the Pope assumes authority over all Christians through self-serving definition: the Orthodox are defined as Christian by virtue of the church that the Pope leads, and Protestants are defined as not Christian. Easy as transubstantiation.
Ecumenism is tricky for the Pope. If Catholicism is one valid Christian tradition among several, then Protestants are friendly, but his silly hats are just silly. If Catholicism is the One True Church, then Protestants tell him to get lost, but at least the silly hats are justified as a holy symbol of the vast authority subsisting in the office of Pontiff.
Benedict said little new. The Vatican moves in little shuffles. Each declaration or statement is nuanced and incremental, impossible for the lay reader to pin down. Officially, Catholic doctrine doesn't change, so they have to change it very slowly.