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Covenant theology is important for many reasons. Though covenant theology has been around for millennia, it finds its more refined and systematic formulation in the Protestant Reformation. Its importance, however, has been heightened in our day because of its relationship to a theology that is relatively new. In the late nineteenth century, the theology called “dispensationalism” emerged as a new approach to understanding the Bible. The old Scofield Reference Bible defined dispensationalism in terms of seven distinct dispensations or time periods within sacred Scripture. Each dispensation was defined as “a period of time during which man is tested in respect of obedience to some specific revelation of the will of God” (p. 5, Scofield Reference Bible). Scofield distinguished seven dispensations including that of innocence, conscience, civil government, promise, law, grace, and the kingdom period. Over against this diversified view of redemptive history, covenant theology seeks to present a clear picture of the unity of redemption, which unity is seen in the continuity of the covenants that God has given throughout history and how they are fulfilled in the person and work of Christ.
Beyond the ongoing discussion between traditional dispensationalists and Reformed theology with respect to the basic structure of biblical revelation, there has arisen in our day an even greater crisis with respect to our understanding of redemption. This crisis focuses on the place of imputation in our understanding of the doctrine of justification. Just as the doctrine of imputation was the pivotal issue in the sixteenth-century debate between the Reformers and the Roman Catholic understanding of justification, so now the issue of imputation has risen its head again even among professing evangelicals who repudiate the Reformation understanding of imputation. At the heart of this question of justification and imputation is the rejection of what is called the covenant of works. Historic covenantal theology makes an important distinction between the covenant of works and the covenant of grace. The covenant of works refers to the covenant that God made with Adam and Eve in their pristine purity before the fall, in which God promised them blessedness contingent upon their obedience to His command. After the fall, the fact that God continued to promise redemption to creatures who had violated the covenant of works, that ongoing promise of redemption is defined as the covenant of grace.
Technically, from one perspective, all covenants that God makes with creatures are gracious in the sense that He is not obligated to make any promises to His creatures. But the distinction between the covenant of works and grace is getting at something that is of vital importance, as it has to do with the Gospel. The covenant of grace indicates God’s promise to save us even when we fail to keep the obligations imposed in creation. This is seen most importantly in the work of Jesus as the new Adam. Again and again the New Testament makes the distinction and contrast between the failure and calamities wrought upon humanity through the disobedience of the original Adam and the benefits that flow through the work of the obedience of Jesus, who is the new Adam. Though there is a clear distinction between the new Adam and the old Adam, the point of continuity between them is that both were called to submit to perfect obedience to God.
When we understand Christ’s work of redemption in the New Testament, we focus our attention largely on two aspects of it. On the one hand, we look at the atonement. It’s clear from the New Testament teachings that in the atonement Jesus bears the sins of His people and is punished for them in our place. That is, the atonement is vicarious and substitutionary. In this sense, on the cross, Christ took upon Himself the negative sanctions of the old covenant. That is, He bore in His body the punishment due to those who violated not only the law of Moses, but also the law that was imposed in paradise. He took upon Himself the curse that is deserved by all who disobey the law of God. This, Reformed theology describes in terms of “the passive obedience of Jesus.” It points to His willingness to submit to His reception of the curse of God in our stead.
Beyond the negative fulfillment of the covenant of works, in taking the punishment due those who disobey it, Jesus offers the positive dimension that is vital to our redemption. He wins the blessing of the covenant of works on all of the progeny of Adam who put their trust in Jesus. Where Adam was the covenant breaker, Jesus is the covenant keeper. Where Adam failed to gain the blessedness of the tree of life, Christ wins that blessedness by His obedience, which blessedness He provides for those who put their trust in Him. In this work of fulfilling the covenant for us in our stead, theology speaks of the “active obedience” of Christ. That is, Christ’s redeeming work includes not only His death, but His life. His life of perfect obedience becomes the sole ground of our justification. It is His perfect righteousness, gained via His perfect obedience, that is imputed to all who put their trust in Him. Therefore, Christ’s work of active obedience is absolutely essential to the justification of anyone. Without Christ’s active obedience to the covenant of works, there is no reason for imputation, there is no ground for justification. If we take away the covenant of works, we take away the active obedience of Jesus. If we take away the active obedience of Jesus, we take away the imputation of His righteousness to us. If we take away the imputation of Christ’s righteousness to us, we take away justification by faith alone. If we take away justification by faith alone, we take away the Gospel, and we are left in our sins. We are left as the miserable sons of Adam, who can only look forward to feeling the full measure of God’s curse upon us for our own disobedience. It is the obedience of Christ that is the ground of our salvation, both in His passive obedience on the cross and His active obedience in His life. All of this is inseparably related to the biblical understanding of Jesus as the new Adam (Rom. 5:12–20), who succeeded where the original Adam failed, who prevailed where the original Adam lost. There is nothing less than our salvation at stake in this issue.