Both Dispensational and Covenant theologians say they want to read Scripture literally etc. Yet we reach radically different conclusions re Israel.
See this
essay.
It's a chicken and egg thing. Do we have our hermeneutic because of our theology or our theology because of our hermeneutic? The truth is probably that there is a reciprocal relation between the two. No one can say anymore, "I'm just reading the Bible..."
First of all, there's an "I'm" in "I'm just reading the Bible." A person must read the Bible. A Bible-reader lives in a given time and place. He is a product of his time and place. He, being a creature, can't transcend his time and place. So he "reads" his Bible under lots of influences. He's aware of some and not of others.
Second there is the verb "to read." There are obviously lots of ways to read a text, especially a text as layered as Scripture. So, some one, under some influences, is reading something, somewhere. To explain this would require a textbook. See e.g., Kevin Vanhoozer's work.
The short story is that Dispensationalists are convinced that national Israel is at the center of God's redemptive activity and they read the Bible in that light.
Covenant theology reads the Bible to say that Christ (the Christ of the Covenants) is at the center of redemptive history and that Israel, as it were, works for Christ. God's relations to
national Israel were intentionally temporary and illustrative of his plan to redeem all his people through the obedience of his Son. See
this essay.
Dispensationalists have been wont to imply/say that they are free from historical influence. It's a form of Biblicism (see above). Cov theology is, otoh, organically related to the way Christians have read the Bible since the earliest days. Read any of the early fathers on the unity of redemption, Irenaeus, Matthetes, et al and you will find them using a hermeneutic quite like that of covenant theology. [On early Christian eschatology see C. E. Hill] The medieval theologians, despite their faults, tended to see the history of redemption as united in Christ. The Reformation overwhelmingly read the Bible as CT does as did the 17th century orthodox. Historically considered, Dispensationalism" is about 150 years old. It isn't the hermeneutic of historic Christianity. Honest Dispensationalists will admit this.
There is, however, in my experience, a certain correlation between ignorance of historic Christianity and Dispensationalism, especially on the popular level. The Dispensationalists I've known specialize in creating a culture wherein they peddle gnostic insights into the Bible that no-one has had before e.g., "the Pauline epistles are not for "today" or "here's how this news event fulfills this prophecy." Laity in Dispensational churches are often shocked to find that their hermeneutic and theological system is a novelty.
The other factor is eschatology and world view. The older dispensational premillennialists tend to have an almost gnostic view of material reality. They want to escape it (via rapture) and they have the gnostic dialectic of indulgence and repression. One day they want to take back America for Christ or advocate antinomianism (Zane Hodges' antinomianism is related to his Dispensationalism) and the next day they are trying to flee material reality ("don't taste, don't touch" etc). Perhaps this describes older forms of dispensationalism better than the more recent versions?
CT has tended to be implicitly or explicitly non-millenarian, though not exclusively. There was an outbreak of historic pre-millennialism in the 17th century. Most of the time, however, we haven't looked for a literal 1000 year reign because we recognized that the Apocalypse was mostly symbolic. [On this I think I've seen dispensational writers treat the 7 churches as symbolic and the rest as literal. Yikes! See Colin Hemer's excellent work on the 7 churches].
From a CT pov, the older forms of dispensationalism seem quasi-Marcionite in their hermeneutic. Most of the older writers, anyway, were convinced that we cannot imitate the method/way the NT writers read the OT. So they have their own hermeneutic over against Paul's or Peter's or John's. Thus, they effectively insulated themselves against ever reforming their conclusions because they can't replicate or imitate the NT hermeneutic! Nice work if you can get it.
CT, otoh, doesn't think that the apostolic hermeneutic was inspired, just the text of Scripture. One doesn't need to be inspired to see "that Rock was Christ." or even to read Scripture as Jesus did in Luke 24 or as 1 Peter 4 does when he makes the New Cov church the holy temple over which the glory-Spirit hovers. 2 Cor 1 says literally that "all the promises are yes and amen in Christ," (not national Israel). Jesus literally re-capitulated the history of Israel (Matt 2) when he went "down to Egypt" and came up "out of Egypt." He literally fulfilled the promise to destroy and re-build the temple in three days. It's not a matter of who reads the Bible literally, it's a matter of who reads the Bible literally the way the Bible wants to be read, the way the Bible writers, esp. the Apostles, read it themselves. So ask yourself, who is a better guide to understanding the Hebrew Scriptures, Paul or C. Ryrie? There
really is a choice.
rsc