Dispensationalists hold that salvation was ALWAYS "by grace, through faith." No one was ever justified by keeping the law. Even in the Old Testament, the Holy Spirit said that the just shall live by faith. And they hold that the basic ways of God never change.
The central of Dispensationalism is that, although God's basic ways never change, He, from time to time, changes the way He deals with mankind. But these changes have not been random, or changing from plan A to plan B, as it were. Instead, they have been, from the beginning, part of a systematic plan to demonstrate that mankind would fail under any conceivable circumstance.
This is never explicitly stated in the Bible. But the changes in the way God dealt with mankind can be clearly seen in the scriptures.
At first, God came down in a visible form and openly talked with mankind. And He did not even give mankind a knowledge of the difference between good and evil. But mankind, which at that time consisted of only two individuals, broke the only command God had given them. And this period, which we call a dispensation, ended with mankind being expelled from the garden of Eden.
Then God left mankind up to their own conscience. But the earth became filled with corruption and violence. And this period or dispensation ended with the worldwide flood of Noah.
Then God established government in the earth, giving mankind a command to execute justice. But mankind united in rebellion against God, deciding to build a tower so high it reached heaven. And this period or dispensation ended with the languages of mankind being confused, so they could no longer communicate with each other.
Then God called out a single man, and gave him a promise for his descendants. But his descendants forgot the promise. And this period or dispensation ended with the family of that man reduced to hopelessness in slavery in a foreign land.
Then God gave mankind a law by which to live, promising them blessing if they kept that law, but cursing if they broke it. but they broke that law and thereby lost the blessing. And this period or dispensation ended with the only individual that ever kept that law hanging on a tree.
Then God promised a full and free pardon to anyone who simply trusted in the sacrifice Jesus made at Calvary. But the great bulk of those that profess that trust have turned aside from that simple faith. And God has already told us that this period will end in general apostasy, resulting in unparalleled judgment.
And God has promised one more period in the future, in which He will bring Israel back to their land and to repentance and faith in their Lord. But He has also just as clearly told us that this final period, or dispensation, will end in worldwide rebellion against Himself, resulting in the final destruction of the earth itself.
As the number seven is a number that represents perfection in the scriptures, God is using these seven demonstrations as a perfect demonstration that mankind will fail under any conceivable circumstance. And the point of all this is to glorify the grace and mercy of a God that will so pardon heal creatures as and rebellious and irreconcilable as mankind.
This is the central essence of Dispensationalism, and its teaching extends all the way back into the ancient church writings. (For a full examination of this, see "Ancient Dispensational Truth," by James C. Morris, [full disclosure, that is myself] ISBN # 978-1-945774-29-4, available online.)
But many insist that, to qualify as Dispensationalism, a system of doctrine must stress the distinct difference between Israel and the church. That is, that Israel and the church are two distinct groups, with two distinct destinies. For when we examine the promises to Israel, they were all promises of blessing in this present life, and on the earth. In the Old Testament, there was a general understanding of future bliss with God, but it was never distinctly revealed, other than a few comments that it would take place. But the promises to the church are entirely different. The only thing we are promised in this earth is persecution, if we are faithful. Our promises are all heavenly. We are promised blessing after this life, with Christ in glory. This is a set of promises entirely different from the promises given to Israel.
Dispensationalism flows from a simple acceptance of the many promises of a future blessing for Israel, as meaning exactly what they say. That in a future day all Israel will be gathered back into their ancient homeland, and that the rebels will be purged (by death) from their midst as they return. And that then all the survivors of this judgment will repent and turn back to their God with their whole hearts. And then they will be blessed in their land forever. But that blessing will flow out from them unto the whole world, which will also be judged at the same time.
And that is the essence of Dispensationalism.
