Fundamental Option Theory is the idea that people take a fundamental option for or against God, and that this, not any particular act, determines salvation. Catholic Answers actually has a good writeup.
As the writeup recognizes, and as the Pope did when he condemned this theory, there is something to the circular: in a sense, of course, some sinful actions do not separate us from God if we have a “fundamental option” towards Him–these are known as venial sins. But some do, and they are known as mortal sins. And if the Fundamental Option Theory denies the latter, then it is not compatible with Holy Tradition. And the clear intent of the Fundamental Option people was to be able to say that you can commit a mortal sin and still be saved, with clearly laudable (though ultimately misguided) intent to make saving grace more accessible.
But I think the Fundamental Option people may actually have set themselves up for exactly the opposite. Because from where I stand, it seems clear to me that the Fundamental Option cannot save you, but it can damn you.
The former point first. It’s important to remember that according to the Magisterium, what damns you is not “mortal sin”, it’s unrepentant mortal sin. That is the key. Having a “fundamental option” towards God is precisely to recognize ourselves as sinners in need of grace. If words have any meaning, it seems to me impossible to say that someone who knowingly, willfully and gravely breaks the law of God and then does not repent can have a “fundamental” option or orientation towards God, under any kind of Christian grammar. This is the “circular” aspect of Fundamental Option theory, where it just becomes a restatement of Traditional Catholic teaching, unless it is explicitly construed as undermining the doctrine of mortal sin.
What it does seem to me, however (and this is the latter point), is that it’s possible to imagine someone who never “technically” commits a mortal sin and yet nevertheless has a “fundamental option” against God. I am thinking of people–and we all know one example, I think, and we all are that example, at times–who simply fail at basic empathy. This is particularly true of people who exercise some kind of power. Think of the business manager who only relates to his charges through fear, or bullying, or viciousness, or supererogatory demands. Think of the parent or spouse who, out of bitterness, subtly hurts, the members of his or her family, through constant small acts of selfishness, with no repentance. Think of the person who always seems to relate to others, or talk about others, out of condescension, with cutting remarks, or passive-aggressiveness, and the like. Think of the guy who’s always, but always, mean to waiters and waitresses. Such a person might spend their entire life never committing an act that “rises to the level” of a mortal sin, and yet always, so to speak, failing at basic Christlikeness–choosing a Fundamental Option against God.
In fact, it seems to me to be the substance of Jesus’ critique of the Pharisees. The Pharisee is the one whose actions are in outward conformity to the law, but whose heart is in rebellion to love. The Pharisee, because he takes pride in his fulfillment of the law, and condescends towards sinners, is really worshipping himself, and not God. He has taken a Fundamental Option against God. The Publican and the prostitute will enter the Kingdom first, not because sin cannot destroy sanctifying grace, but because they repent. The Elder Brother of the parable of the Prodigal Son has “done everything right,” yet still has what could be described as a Fundamental Option against the Father. As Tim Keller put it, in that parable, the two brothers are fundamentally alike: they both want the father’s things, but not the father–it’s just that one goes about it by breaking the rules, while the other goes about it by obeying the rules.
All of this is mere speculation. But it seems to me that, if they are taken seriously, the Fundamental Option theorists, in intending to widen the Gates of Heaven, would in fact have narrowed them.