Actual Question: "As protestants we talk a lot about saved by grace alone but James says ‘faith without works is dead'. Of course I know the word ‘alone’ is not in the text, so what gives? (PS - I hate the ‘balance explanation)"
Possible Answer: This is a question that I've often thought about myself and in my mind it's usually phrased like this, "What's the balance between faith and works?" or as was submitted in the question above, we insert the word, "alone". As we tackle this important topic it's important to note from the start that neither Paul in his discourse on faith nor James in his dealings with works ever use the words "balance", "alone" or "only" or any other similarly exclusive term to communicate that one of these vital ingredients is sufficient without the other. It was never about one over the other or about either being in any sort of competition with the other.
Secondly, Paul and James were writing to different audiences who were dealing with different sets of struggles that they were attempting to address with different solutions. To conclude, as some do, that their prescriptions were somehow contradictory to one another is misinformed and out of context. James is writing to the "twelve tribes, who were dispersed abroad" (see James 1:1 NASB). His audience was clearly in need of some practical day to day advice on how to live in a way that brought glory to God. From the outset of his letter he repeatedly addresses practical topics like: facing trials, dealing with temptation, the famous verse of James 1:19 (NASB), "This you know, my beloved brethren. But everyone must be quick to hear, slow to speak and slow to anger...". He challenged the people to not just be hearers of the Word but doers as well, he spoke out against the dangers and power of the uncontrolled tongue and about the dangers of favoritism and the importance of treating the poor with dignity. When you zoom out and consider all that James was addressing it becomes clear that his emphasis on the importance of works was never designed to speak against the importance of faith but rather to highlight the requirement of "spiritual fruit" in the life of a true believer. He makes no assertion that works were or should ever be an avenue to redemption, but rather an overflow of the believer's redemption.
Paul in his letter to the Romans is dealing with a separate set of issues. He's writing of course to the church in Rome who were in need of a fuller understanding of the righteousness of God and the offer afforded them through the sacrifice of Jesus. J Vernon MGee in his commentary powerfully phrases it like this, "Friend, may I say to that the thief on the cross had been declared unfit to live in the Roman empire and was being executed. But the Lord Jesus said that He was going to make him fit for Heaven and told him, "...Today shalt thy be with me in paradise." (Luke 23:43). God takes lost sinners - like I am, like you are - and He brings them into the family of God and makes them sons of God. And He does it because of Christ's death upon the cross - not because there is any merit in us. This is the great message of the Romans." Paul was clearly communicating the power of the Cross that was available to all who would believe and have "faith" in the sacrifice of Jesus for the forgiveness of their sins.
Lastly, it's important to understand the relationship between James' definition of "works" and Paul's definition of "faith". Paul's definition of "faith" was an effort to strike at the very heart of the Gospel, faith in Jesus' work on the cross is paramount in our being saved from our sins. A million "works" earn us nothing towards being made right in God's sight. The only wage we earn for all of our efforts is death (Romans 6:23 (NASB). We are only saved through faith in Jesus Christ. James' definition of "works" centers around believer's becoming the modern day hands and feet of Jesus. Why are we saved? To carry the message forward to those who have not yet received this free gift.
Let's think about "faith" and "works" not as competitors but rather as different functions and stages in the same journey. We are first and foremost called to faith in Christ's work on the cross. We are then called to walk out that saving faith through our works that lift up and magnify the name of Jesus so that others might also come to faith. It's symbiosis at its' finest. You've heard of this right? It's the, "interaction between two different organisms living in close physical association, typically to the advantage of both." As we first enter into a saving relationship with God through "faith" in Jesus our "works" flow naturally from that genuine heart change. As our "works" increase and we witness firsthand the faithfulness of God as He gives us boldness, success and even the tough lessons in failure our "faith" in God increases. Round and round we go in an ever increasing symbiotic upward spiral towards greater intimacy with God. We are saved by our faith in Jesus and we step into the fullness of God through our works. Be encouraged and keep moving forward.