An Overview of Dispensationalism and Covenant Theology

How should we interpret the Bible? Dispensationalism and Covenantalism are competing approaches to interpreting the Bible that frequently reach very different conclusions. Which one makes better sense?

The Bible can be a confusing book, as evidenced by the many Christians who struggle to properly interpret it. Undoubtedly, a major contributing factor to this confusion is the diversity of interpretations offered by pastors and professors. If these experts disagree on how to read Scripture, how can the average believer hope to rightly divide the word of truth? Among Evangelicals, two interpretive systems dominate the theological landscape: Dispensationalism and Covenant Theology. This article will provide a basic overview that will define and contrast these two competing systems while explaining how each view impacts one’s understanding of the biblical narrative.

Dispensationalism is often misunderstood as being a system that cares primarily about the nation of Israel; however, it is much more than that—it is a comprehensive hermeneutical system that has major implications, particularly in the areas of ecclesiology and eschatology (the studies of the church and end times, respectively). Michael Vlach provided the following definition of the view:

Dispensationalism is a system of theology primarily concerned with the doctrines of ecclesiology and eschatology that emphasizes the historical-grammatical meaning of Old Testament prophetic passages and covenants, a distinction between Israel and the church, and a future salvation and restoration of the nation Israel in a future earthly kingdom.1

While Dispensationalism emphasizes a straightforward understanding of the text according to the interpretive principles for the various genres, Covenant Theology views all of Scripture through the lens of either two or three covenants:

Covenant theology is a system of interpreting the Scriptures on the basis of two covenants: the covenant of works and the covenant of grace. Some covenant theologians specify three covenants: works, redemption, and grace.2

According to adherents of Covenant Theology (Covenantalists), Adam was initially under the covenant of works. If he would not have sinned, then he would have procured salvation for himself. But upon his rebellion, every person has been under the covenant of grace, which encompasses the other major covenants in Scripture. The covenant of redemption refers to a supposed covenant made in eternity past between members of the Godhead related to how the Son of God would redeem mankind.

Proponents of both positions agree on fundamentals of the Christian faith and are orthodox. They believe God is triune, and that Jesus is the Son of God whose atoning death and resurrection are the only means by which a sinner can be saved. Nevertheless, these two approaches yield significantly different understandings of Scripture.

Dispensationalism believes that the Old Testament stands on its own. That is, while the New Testament sheds light on the Old Testament, it does not change the meaning of a given Old Testament passage. This is due to its emphasis on the historical-grammatical hermeneutic (interpreting the text while taking into account the cultural and historical background as well as the technical details of the language).

Covenant Theology emphasizes soteriology (study of salvation), endorsing a redemptive-historical hermeneutic, which means that all Scripture is read through a lens that sees God’s salvation of sinners as being the primary purpose of history. This leads its proponents to adopt New Testament priority—i.e., New Testament passages are used to interpret Old Testament texts in ways that were never intended by the original human authors.

These competing approaches make an enormous difference in how major themes in Scripture are understood. Perhaps the most noticeable difference surrounds the relationship between Israel and the church. Since Dispensationalists give equal priority to both testaments, they believe that Israel still holds a unique place in God’s plan because numerous prophecies about Israel have not been fulfilled yet. As such, Dispensationalists believe that these prophecies will be fulfilled in relation to the Second Coming and Millennial reign of Christ.

Covenantalists claim that God’s promised blessings for Israel should be transferred to the church because Jesus is the fulfillment of the Law and the church replaces or supersedes Israel. And now that Christ’s bride, the church, is here and the gospel has been sent out to all nations, it does not seem to make sense that the Lord would shift His focus back to just one nation. As a result, scores of Old Testament prophecies are spiritualized, such as the last several chapters of Ezekiel. New Testament prophecies that seem to be about Israel must also be reinterpreted to refer to the church. For example, the thousand-year period mentioned six times in Revelation 20 is not understood as a literal fulfillment of the Old Testament kingdom promises to Israel. Instead, covenantalists interpret it non-literally as either a spiritual kingdom or one that does not last for a millennium, or if they do interpret it as a literal millennium, then it is not specifically for Israel.

Another major difference between these two positions involves one’s understanding of the Old Testament Law. For Dispensationalists, the Mosaic Law was given to the people of Israel for a specific time and place. Hebrews 8:13 states that the Mosaic covenant has been made obsolete by the new covenant instituted by Christ. And since Dispensationalists do not conflate Israel and the Church, the Mosaic Law is not binding on Christians who are under “the law of Christ” (Galatians 6:2). However, since covenantalists view all of the biblical covenants as being different aspects or expressions of the overarching covenant of grace, the Mosaic Law must still be in place for the church in some way. Typically, they divide the Mosaic Law into civil, ceremonial, and moral laws. With Christ’s sacrificial death, the ceremonial or sacrificial laws were set aside, but the civil and moral are still in effect, although they are sometimes adapted to fit one’s cultural setting. It must be stated that while these categories may be helpful in understanding the types of laws described in the Pentateuch, the Bible never divides the Mosaic law in such a way. Instead, the Mosaic law is always treated as a whole unit: “For whoever shall keep the whole law, and yet stumble in one point, he is guilty of all” (James 2:10, cf. Galatians 5:3).

I believe Dispensationalism is a far better system of interpretation, since the meaning of the text is viewed as residing in the text itself, rather than depending on one’s reinterpretation as seen through the lens of the New Testament, as is the case with Covenant Theology. Furthermore, Covenant Theology sees all of Scripture through the lens of two or three covenants that are never mentioned in Scripture (covenant of works and covenant of grace). Consistent with the Dispensational approach, the New Testament characters and authors interpreted the Old Testament in a contextual manner.3 Dispensationalism also allows the Old Testament prophecies about Israel’s future to be fulfilled in a manner consistent with other prophecies. Finally, whereas Covenant Theology views God’s redemption of fallen humans as the focus of history, Dispensationalism emphasizes that Christ’s atonement leads to a restoration of all creation. Thus, while both emphasize God’s glory, Covenant Theology tends to focus on man’s salvation and Dispensationalism calls attention to what God is doing to restore and renew all of His creation, including mankind.

  1. Michael J. Vlach, Dispensationalism: Essential Beliefs and Common Myths, Revised and Updated (Los Angeles, CA: Theological Studies Press, 2017), 50. 

  2. Paul Enns, The Moody Handbook of Theology, (Chicago, IL: Moody Press, 1989), 503. 

  3. Of the roughly 360 New Testament quotations or citations of Old Testament texts, Covenantalists often point to about five that they believe have been reinterpreted by the New Testament authors. Dispensationalists like Abner Chou (The Hermeneutics of the Biblical Writers) and Michael Vlach (The Old in the New) have shown how these examples have not been reinterpreted by New Testament authors. However, even if these few passages had been reinterpreted by New Testament authors, this would mean that less than 2% of the Old Testament citations in the New Testament have been reinterpreted. This is hardly a solid basis on which to build a hermeneutic in which one must reinterpret scores of passages. Furthermore, the writings of the New Testament were inspired by the Holy Spirit. Covenantalists certainly do not believe their writings are likewise inspired, so why adopt a hermeneutic that implies as much and that overrides the plain meaning of the text? 

My Dissertation and Doctoral Degree

Getting a photo with my lovely bride prior to the graduation ceremony. Notice that she’s standing on a higher step to slightly make up for the height difference.

Dr. Tim Chaffey—yeah, it still sounds weird. On May 21, I graduated from Shepherds Theological Seminary in Cary, North Carolina after earning a Doctor of Ministry, specializing in advanced biblical and theological studies. This is the main reason I have written so few blog posts over the past couple of years—I’ve been too busy with my classes. I plan to post numerous articles in the coming months that will be adapted from some of my assignments.

Completing a doctorate has been a long journey. I originally enrolled in the Ph.D. in Apologetics and Theology at Liberty in 2008. After a year of courses, I switched programs and earned a Th.M. instead. The main reason for this was the time commitment. I was spending about 20–25 hours a week on school and working full-time while my kids were still relatively young. I realized that I would not have finished the program until my daughter had finished high school and my son would have been in junior high. I decided that I wouldn’t even consider working on a doctorate until my son finished high school. Spending time with the kids was too important, so I left that program even though I really enjoyed it…well, most of it. I’ll be happy if I never crack open another book by or about Augustine of Hippo (5,000 pages of reading and writing 50 pages for one class was more than enough for me).

Shortly before my son finished high school, I had an opportunity to give a tour of the Ark Encounter to some students and staff from Shepherds. When I checked out the school’s doctrinal statement and saw that one of the doctoral areas of specialization was advanced biblical and theological studies, I became very interested. Within a year, I had enrolled in classes, and last week I became part of the first class of doctoral graduates at Shepherds.

I truly enjoyed my classes and my dissertation fit perfectly with the next big project the design team is working on for the Ark Encounter. We are building the world’s most accurate model of first century Jerusalem. The massive model at Israel Museum in Jerusalem is built on a 1:50 scale (1 foot = 50 feet), and our model will be half that scale (1:100). While that model is amazing, ours will far surpass it in terms of accuracy and realism. The Israel Museum model is rather plain in that it only depicts the buildings and walls, and nearly everything is made out of the same stones. Also, that model was made in the 1960s, prior to many of the archaeological excavations in the city. Our model will reflect the latest research, and we plan to populate our model with 15,000–20,000 miniature 3D-printed people as well as thousands of animals, trees, and other objects that would be seen in a city. We plan to enhance the experience with dozens of interactive displays filled with biblical, historical, and archaeological teaching.

The hooding ceremony with Dr. Pete Goeman (left) and Dr. Dave Burggraff (right).

Since I will be responsible for developing the teaching content that will be associated with the model, I wanted to write my dissertation on a subject that would relate to the project. My paper is titled “A Historical Study of Jerusalem c. AD 33 and Its Implications on Creating an Accurate Scale Model to Enable Believers to Gain a Deeper Understanding of the New Testament.” After highlighting the importance of biblical geography to hermeneutics, I spent the bulk of the paper contrasting first-century Jerusalem to today’s “Old City.” This necessarily included an examination of numerous misnamed/misplaced sites that tourists are typically shown while touring Jerusalem as well as critiques of a couple conspiracy theories related to the temple and Temple Mount. Finally, one chapter describes the work that has already gone into designing and building our model.

Since completing the dissertation, I have been writing a book to address the conspiracy theories related to the temple and Temple Mount. Over the past few decades, some individuals have promoted the idea that Solomon’s and Herod’s temples were located in the City of David rather than on the Temple Mount. Known as the Alternate Location Theory (ALT) and popularized by Ernest L. Martin and Robert Cornuke, the theory is demonstrably false and its proponents ignore archaeological findings and regularly misuse historical sources, such as the Bible and the writings of Josephus. Since much of the research was conducted while writing my dissertation, it should not take too long to write, and I hope it will be available within a few months. I’ll share more details about this project in upcoming posts.