Objection 1. It would seem that grace was given in the baptism of John. For it is written (Mark 1:4): "John was in the desert baptizing and preaching the baptism of penance unto remission of sins." But penance and remission of sins are the effect of grace. Therefore the baptism of John conferred grace.
Objection 2. Further, those who were about to be baptized by John "confessed their sins," as related Matthew 3:6 and Mark 1:5. But the confession of sins is ordered to their remission, which is effected by grace. Therefore grace was conferred in the baptism of John.
Objection 3. Further, the baptism of John was more akin than circumcision to the baptism of Christ. But original sin was remitted through circumcision: because, as Bede says (Hom. x in Circumcis.), "under the Law, circumcision brought the same saving aid to heal the wound of original sin as baptism is wont to bring now that grace is revealed." Much more, therefore, did the baptism of John effect the remission of sins, which cannot be accomplished without grace.
On the contrary, It is written (Matthew 3:11): "I indeed baptize you in water unto penance." Which words Gregory thus expounds in a certain homily (Hom. vii in Evang.): "John baptized, not in the Spirit, but in water: because he could not forgive sins." But grace is given by the Holy Ghost, and by means thereof sins are taken away. Therefore the baptism of John did not confer grace.
I answer that, As stated above (2, ad 2), the whole teaching and work of John was in preparation for Christ: just as it is the duty of the servant and of the under-craftsman to prepare the matter for the form which is accomplished by the head-craftsman. Now grace was to be conferred on men through Christ, according to John 1:17: "Grace and truth came through Jesus Christ." Therefore the baptism of John did not confer grace, but only prepared the way for grace; and this in three ways: first, by John's teaching, which led men to faith in Christ; secondly, by accustoming men to the rite of Christ's baptism; thirdly, by penance, preparing men to receive the effect of Christ's baptism.
Reply to Objection 1. In these words, as Bede says (on Mark 1:4), a twofold baptism of penance may be understood. one is that which John conferred by baptizing, which is called "a baptism of penance," etc., by reason of its inducing men to do penance, and of its being a kind of protestation by which men avowed their purpose of doing penance. The other is the baptism of Christ, by which sins are remitted, and which John could not give, but only preach, saying: "He will baptize you in the Holy Ghost."
Or it may be said that he preached the "baptism of penance," i.e. which induced men to do penance, which penance leads men on to "the remission of sins."
Or again, it may be said with Jerome [Another author on Mark 1 (inter op. Hier.)] that "by the baptism of Christ grace is given, by which sins are remitted gratis; and that what is accomplished by the bridegroom is begun by the bridesman," i.e. by John. Consequently it is said that "he baptized and preached the baptism of penance unto remission of sins," not as though he accomplished this himself, but because he began it by preparing the way for it.
Reply to Objection 2. That confession of sins was not made unto the remission of sins, to be realized immediately through the baptism of John, but to be obtained through subsequent penance and through the baptism of Christ, for which that penance was a preparation.
Reply to Objection 3. Circumcision was instituted as a remedy for original sin. Whereas the baptism of John was not instituted for this purpose, but was merely in preparation for the baptism of Christ, as stated above; whereas the sacraments attain their effect through the force of their institution.
Source: Summa Theologica (New Advent)