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For follow-up discussion and general commentary on the topic. Comments are sorted chronologically.
Aurel Gheorghe
It is generally accepted by Bible scholars that are two types of Jews: the physical descendants of Abraham, and the spiritual Jews, Christ's Church.
The first time the name “Israel” appears in Scripture is when it was spoken to Jacob after his night of wrestling with a powerful opponent. The heavenly stranger said: “Thy name shall be called no more Jacob, but Israel," (Genesis 32:28). Although the name “Israel” was at first applied only to Jacob, his descendants (he had 12 sons) eventually multiplied into the 12 tribes, which were later forced into slavery by the Egyptians until the time of Moses. Then God told Pharaoh through Moses, “Israel is my son, even my firstborn... Let my son go.” (Exodus 4:22, 23)
Now the name “Israel” was expanded to include Jacob’s descendants.
The prophet Hosea is referring to God's chosen people in a similar manner: “When Israel was a child, then I loved him, and called my son out of Egypt.” (Hosea 11:1)
The Lord also told the ancient Israelites, “And you shall be unto me a kingdom of priests, and an holy nation.” (Exodus 19:6) In the New Testament, Peter applies almost similar words to the church: “But you are a chosen generation, a royal priesthood, an holy nation, a peculiar people.” (1 Peter 2:9)
Paul also writes, “Know you therefore that they which are of faith, the same are the children of Abraham.” (Galatians 3:7) “For we are the circumcision, which worship God in the spirit, and rejoice in Christ Jesus, and have no confidence in the flesh.” (Philippians 3:3) Thus, according to Paul, a real Jew in the sight of God is anybody—Jew or Gentile—who has personal faith in Jesus Christ!
Finally, Jesus marveled at the faith of a Gentile soldier. He said, “Assuredly, I say to you, I have not found such great faith, not even in Israel! And I say to you that many will come from east and west, and sit down with Abraham, Isaac, and Jacob in the kingdom of heaven. But the sons of the kingdom will be cast out into outer darkness.” (Matthew 8:10-12)