The religion issue appears to have given Walter F. Mondale's presidential campaign a psychological boost in this traditionally Democratic border state when he desperately needed it, but Republicans here believe that the issue will help President Reagan in the long run.
The Mondale campaign seemed dead in the water in this state until last week when Sen. Wendell H. Ford, the state's most powerful politician, agreed to head it, party leaders said.
But the Ford appointment, coupled with national publicity surrounding the religion issue, has pumped the first signs of life into the Mondale effort, especially among moderate and liberal Democrats in urban areas around Lexington and Louisville.
"He Mondale may be on to something," Sen. Walter D. Huddleston (D-Ky.) said of the issue. "There was a lot of queasiness over the role of the fundamentalists at the Republican convention."
"What the Reagan administration is trying to do is portray their party and their particular brand of religion as God's party, the party that represents the Almighty," said Huddleston, who is heavily favored to win reelection to a third term even if Reagan carries the state. "I think that is wrong. No political party has a corner on spirituality."
"A week ago I would have said that Mondale couldn't win Kentucky, but now people are beginning to stop apologizing about the ticket," said Bill Wester, a former executive director of the Senate Democratic Campaign Committee and one of the state's leading political operatives. "I think Reagan is playing with dynamite with religion. I'd play it to the hilt if I were Mondale. He certainly can't talk about the economy."
The politics of religion, however, are an extremely delicate matter in the religiously conservative border and southern states, and many political observers here say Mondale may come out on the short end of the religion issue, especially among conservative Democrats in rural areas.
"That dog don't hunt in Kentucky," said Jefferson County Judge Mitch McConnell, Huddleston's GOP opponent. "I think the Mondale people are in the wrong place with the wrong issue if they hope to carry the South."
"You have to remember this is a Bible belt," said Larry Forgy, state chairman of the Reagan-Bush campaign. "I might not talk a lot about religion in Louisville or Lexington, but the issue has tremendous appeal in rural Kentucky. I find it almost impossible to find anyone in the rural areas of the state excited about Mondale."
A Reagan campaign official said today he believes that the religion issue is helping the president throughout the South. "The South is really crystallizing," he said. "You can't kick religion the way Mondale has."
The currents of religious fundamentalism run deep in Kentucky and much of the South, and the distinction between religion and politics has often been blurred here.
The debate over religion between Mondale, the son of a Methodist minister, and Reagan arose at the Republican National Convention in Dallas when the president told a Christian prayer breakfast that he considered religion and politics inseparable and that those who argued otherwise were "intolerant of religion."
Kentucky Gov. Martha Layne Collins and several other conservative Democratic governors told Mondale at a meeting later in Minnesota that they sensed a backlash against Reagan's use of religion and the prominent role played at the GOP convention the founder of the Moral Majority, the Rev. Jerry L. Falwell, and other fundamentalist Christians.
Mondale seized on the issue, accusing Reagan Thursday of embracing a "determined band" of religious groups that "are reaching for government power to impose their own beliefs on others."
The debate over separation of church and state has caused surprisingly little public discussion here. "I don't hear people buzzing about it at the gas station," one Democrat said.
But the debate has given Democratic activists, disillusioned with Mondale's performance since the Democratic convention, a temporary rallying point. It also has deepy polarized some religious groups.
Nowhere is this polarization more heatedly discussed than at the Southern Baptist Theological Seminary, the denomination's oldest such institution, atop the rolling hills of Louisville's fashionable East End.
Dr. Roy Lee Honeycutt, the normally mild-mannered president of the 125-year-old seminary, last week declared a "holy war" against fundamentalists who he said were trying to "hijack" his denomination.
Honeycutt, in an interview today, said Reagan has courted "the same crowd" and embraced their causes, including prayer in public schools and the prohibition of legalized abortion. "I don't think he understands the separation of powers. The state profits best and the church profits best at an appropriate distance," he said.
"We are running a very real risk of a de facto state church. The danger is the loss of freedom of religion," Honeycutt added.
The picture looks quite different across town at Ninth & O Baptist Church, located in a blue-collar area a few furlongs from the Churchill Downs Race Track. The church pastor is the Rev. LaVerne Butler, 58, a Southern Baptist Seminary graduate who heads the Kentucky branch of the Moral Majority.
Butler is a lifelong Democrat, who says, "I'm doing everything I can to get decent Democrats to get their party back." But when the subject is politics, he insists that there's one line he never crosses from the pulpit -- endorsing a specific candidate or party.
But it is not hard for anyone in the 4,500-member church to tell who Butler supports this year. After Republicans and Democrats held their national conventions, he said he told parishioners that the two conventions were about as different as "a sex orgy and a Sunday school picnic. I just let them decide which was the sex orgy and which was the Sunday school picnic."
Butler avoids mentioning Mondale or Reagan by name, but he has some very harsh words for the Democrats, who he says were "stupid going to San Francisco. You don't get elected there unless you're homosexual," he said. "I think their platform and the things they are promoting are very evil. Abortion is evil. It's wrong. It's perversion. It's murder. Homosexuality is perversion."
Butler gets little disagreement from church members, many of them registered Democrats. Their words carry some troubling signs for Mondale.
"If we can't have some religion in politics, what's the world coming to," said Eugene T. Noe, a retired distillery worker. "If they don't get more politics in the church, this country's gonna go down the drain."