This is a large theological but very important issue. My present task is a bit daunting because it is such a large issue to address in such a short space but I feel compelled to address it for a couple of reasons. First, I just preached through 1 Peter 2:9-10 which adresses the issue head on and was barely able to adress this issue or even deal with related passages! The second reason is that the discussion surrounding this issue shows a lack of biblical understanding and theological framework that I see all too often. So here is a brief statement of my present understanding of Israel and the church.
It is clear from the Old Testament that Israel was God's chosen people, he was their God. The reason God chose Israel and gave them these privileges is clear from Isaiah 49:3, And [God] said to me, "You are my servant, Israel, in whom I will be glorified." Or in Jeremiah 13:11, God says that he chose Israel and made them his own possession "that they might be for me a people, a name, a praise, and a glory." God's aim was to fill the universe with his glory and praise through what he did with this people Israel.
Now in Ephesians 2:11-22, Paul is saying that this is the destiny of the church. Starting at verse 12, Paul describes what our condition was as Gentiles before Jesus the Messiah came. "Remember that you were at that time separate from Christ, excluded from the commonwealth of Israel, and strangers to the covenants of promise, having no hope and without God in the world." That's where we start. Then Jesus comes, and all that changes. Look at verse 19, "So then you are no longer strangers and aliens, but you are fellow citizens with the saints, and are of God's household."
The same summary statement is given in Ephesians 3:6 where Paul defines the mystery of Christ that he preaches: "to be specific, [the mystery of Christ is] that the Gentiles are fellow-heirs [with the Jews] and fellow-members of the body, and fellow-partakers of the promise in Christ Jesus through the gospel."
What happened? Once we were separated from Christ, now Christ himself has drawn near to us. Once we were excluded from the commonwealth of Israel, now we are fellow citizens in Israel. Once we were strangers to the covenants of promise, now we are fellow partakers of the promise. Once we were without hope, now we are fellow heirs of all God has to give. Once we were without God in the world, now we are members of God's household.
And the whole picture here is not that we move into these blessings on separate, parallel tracks apart from Israel--them, without Jesus, and us, with Jesus--but that we move into them together on one track--through one Savior, one cross, one body, one new man, one Spirit to one Father. The picture here is that the church of Christ, made up of a remnant of believing Jews and believing Gentiles, fulfilled the identity and destiny of Israel. The church, are the new people of Jesus. Not Jew and Greek, not slave and free, not male and female, not barbarian, Scythian, free but Christ is all and in all (cf. Gal. 3:28; Col. 3:11)
Now let's be more precise and notice the actual words that prove this oneness of Jew and Gentile in the new people of God. Verse 14: "He is our peace, who made both groups (Jews and gentiles) into one." Christ did not come to open a second alternative way to God. He came to make Jew and Gentile one in his church.
Verse 15b: "...that in himself he might make the two (Jew and Gentile) into one new man, thus establishing peace." Here he pictures the church as a single person. Once there were Jewish persons and Gentile persons. Now Christ comes and unites them to himself so that "in himself" there would be only one new person, namely Christ: There is neither Jew nor gentile, but Christ is all and in all (Col. 3:11). Christ is the one new man. Which leads us naturally to verse 16 where Jew and gentile are the one body of the one new man. There are not two people of God but one new man.
Verse 16: "...and [that Christ] might reconcile them both (Jew and gentile) in one body to God." The reconciling work of Christ brings people to God not in two alien bodies, one rejecting him (Jewish) and one trusting him (Christian). Christ brings Jew and gentile to God in one body, the church.
And not only in one body, but also in one Spirit. "For through him (Christ) we have access in one Spirit to the Father (v. 18)." So Paul sums up this great unified work of salvation in 4:4-6, "There is one body and one Spirit, just as also you were called into the one hope of your calling, one Lord, one faith, one baptism, one God and Father of all who is over all and through all and in all."
So what is Paul's answer to the problem that God chose Israel to be the fullness of his glory and yet now promises that glory to the church? His answer is that Israel is fulfilled in the church and the church has emerged as the new people of God.
There had always been a faithful remnant of believing Jews in physical, ethnic Israel. These were the true Israel. Not all Israel (physical) was true Israel (spiritual) (Romans 9:6). When Jesus the Messiah came, the proof of whether a Jew was part of the true Israel was whether he confessed Jesus as the Son of God or denied him. Jesus said, "He who does not honor the Son, does not honor the Father who sent him" (John 5:23). If you reject Jesus you reject God; and if you reject God you are not part of true Israel.
Jesus is the point in redemptive history where the true Israel becomes the church of Christ and the church (Jew & Gentile).
There are not two saving covenants. There are not two saved peoples. And the reason is that there are not two ways of salvation. Verse 16 shows us the unifying foundation of salvation and the people of God. "[Christ] reconciled them both (Jew and Gentile) in one body to God through the cross, by it having put to death the enmity." Jews needed the cross and gentiles needed the cross. After centuries of animal sacrifices that pointed forward to the True Sacrifice, Jews needed to be reconciled to God and gentiles needed to be reconciled to God. There was enmity not only between Jew and gentile, but at root there was enmity between Jews and God and gentiles and God that needed to be overcome by the peace-making work of Christ.
So there was one great work of salvation on the cross when Jesus died to remove the enmity between God and Jew and between God and gentile. And he did this reconciling work not separately but in one body, the church. Jew and Gentile are reconciled to God in Christ. That is why being reconciled to God means being reconciled to each other. That is why there cannot be two peoples and two tracks to heaven. For there is one way to be reconciled to God: Christ reconciles us to God by uniting us to himself. And that means we become one body, Jew and Gentile. Maybe I will tackle this some more later this week.