Why do some ultra-traditionalist Orthodox re-baptize Catholic converts to Orthodoxy? Because, in the name of Holy Tradition, they are heirs to the innovative notions of St. Nicodemos of the Holy Mountain in the 18th century … In trying to synthesize this exclusivist ecclesiology with the notion of “oikonomia” a la St. Basil, and which had guided Orthodox praxis for centuries, St. Nicodemus had to invent a whole new way of understanding that notion as it applied to the sacraments. In effect, he invested Orthodox bishops with the power to determine by an exercise of sheer authority whether a sacrament was valid or not. Thus the practice before 1755 of admitting Catholics to Orthodoxy without baptism could be explained as an “economic” exercise of episcopal authority, rather than (as it had been for centuries) as flowing from the actual validity of the Catholic baptism.
And from one of the post’s comments:
If it is true, as some Orthodox believe, that Catholic baptisms are invalid, then nothing should be able to change that except a valid baptism — not even the application of episcopal “oikonomia”, lest we say that a bishop can by his decree actually make a person that which he/she is not, i.e. a Christian baptized into the death and resurrection of Jesus Christ. On the other hand, if Catholic baptisms are valid, then the Orthodox must no longer regard Western Christians as “other”, but as co-heirs to the life in Christ–brothers and sisters from they must not suffer themselves to be alienated. What then?