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Prophetic types have to be understood in their relationships to other people. For example, Ishmael must be viewed juxtaposed to Isaac. It is the same with Hagar and Sarah, Jacob and Esau, Judah and Joseph, Saul and David, Moses and Joshua, Moses and Elijah, etc. One cannot understand either type without understanding both of them.
Hagar represents the Old Covenant, but there is no "Old" Covenant without a "New" one (Sarah). And since there are "children" of each, we must also understand how Ishmael and Isaac are compared and contrasted in Scripture. Most importantly, we must know which people they represent in real life on the earth.
Many people today are accustomed to thinking of these "children" either as genealogical children or as purely spiritual children. Most of the time, each side argues for one side or the other without seeing that BOTH are correct, depending on the level of interpretation. So it is argued on one side that Ishmael is a type of the Arab people today, and on the other side, Ishmael is a type of "fleshly people," that is those "born after the flesh" (Gal. 4:49).
One does not have to be a physical descendant to be a type of an Old Testament character. Jesus was a type of Moses (Acts 3:22), but Moses was of Levi, whereas Jesus was of Judah. Likewise, there is no evidence that John the Baptist was a descendant of Elijah.
The biblical expression "children" or "son of" did not always mean a physical child of someone. This term was used many times to indicate similar character or similar actions. While Jesus was a "son of David" in the genealogical sense, there were also "children of light" (Luke 16:8), and of wisdom (Luke 7:35), as well as sons of thunder (Mark 3:17) who had "thunderous" personalities.
Likewise there were "children of the devil" (1 John 3:10) who were adversaries of Christ, as well as "children of Abraham," who belong to Christ and are therefore heirs of the promise (Gal. 3:29).
In a way, the "children" are the anti-types of their "father." While there might be a genealogical connection on one level, the biblical expression often goes far beyond genealogy.
So when we focus upon Hagar, Paul tells us in Galatians 4:25 that Hagar is not only Mount Sinai, but it is also the old Jerusalem, the physical city in Palestine. Likewise, Hagar's "children" are those who preferred to remain subject to Mount Sinai, the inheritance of Ishmael, rather than to come under the jurisdiction of the New Covenant.
Hence, those who call themselves Jews are "Ishmaelites," whose mother is Hagar. This is not by genealogy, but by a legal declaration in the Divine Court. Their rejection of the Messiah at the cross sealed their decision as a religion, and each individual who agreed with the decision of the leadership became an Ishmaelite by lawful decree from the Divine Court.
This did not mean that they were stuck in that position forever. Paul himself was an Ishmaelite from Hagar, persecuting the Church, until his conversion on the Damascus road. His citizenship then changed, because he recognized the Mediator of the New Covenant and became a child of Sarah.
In fact, if we go back to the beginning, we find that the entire nation of Israel under Moses were spiritual Ishmaelites. They were children of the Old Covenant, given to them at Sinai. This is pictured even prior to Moses in the story of Abram and Hagar.
The reason that Sarai gave her bondmaid, Hagar, to Abram was to bring forth the child of promise. At that time they still had no clear revelation that the child of promise was to come through Sarai (after her name was changed to Sarah). Ishmael was 13 years old when Abraham was 99 and the full revelation came to them. By this time Ishmael had reached level-2 Sonship.
The three levels of Sonship are: (1) birth or weaning; (2) the age of 13, or bar-mitzvah, (3) the "adoption of sons" at maturity.
So Ishmael had a partial and incomplete claim to Sonship. The point is that Abram took Hagar the Egyptian to be his "wife" (Gen. 16:3) and brought forth Ishmael. This was a prophetic story of what God would do later with Egypt itself. When it came time for Israel to be brought forth (born) out of Egypt, God sent Moses to tell Pharaoh in Exodus 4:22, "Thus says the Lord, Israel is My son, My first-born."
If Israel was God's son, then Egypt was Israel's mother. It was the same situation as when Abram had taken Hagar to bring forth Ishmael. So Abram's son Ishmael was a type of Israel when they were brought forth from Egypt under Moses.
This is made clearer when the law was given at Sinai, because we read in Exodus 13:12, 13,
(12) you shall devote to the Lord the first offspring of every womb, and the first offspring of every beast that you own; the males belong to the Lord. (13) But every first offspring of a donkey you shall redeem with a lamb . . . and every first-born of man among your sons you shall redeem.
Ishmael was called by the angel a WILD DONKEY MAN (pereh awdawm) in Gen. 16:12. So when Israel came out of Egypt as spiritual Ishmael, he was God's firstborn donkey. Hence, it was required by law that Israel be redeemed with a lamb. That is why they were redeemed from Egypt by the Passover Lamb.
So it is clear that Israelites under the Old Covenant are Ishmaelites from Hagar-Egypt. As Ishmaelites, they are children of Abram, not Abraham. And while it may APPEAR that they are the chosen "heirs" for many years, they are NOT. No one can be the heir to the promises unless they are children of Sarah, the New Covenant.
Yet even as Abram himself was apparently ignorant of this until he was 99 years old, so also is this fact hidden from many today. It is all part of the "blindness in part" that is a major theme throughout Scripture. But we have come now to the end of this age, where the truth revealed in the NT is now being clarified as well.
One must be part of the white-horse company, rather than of the donkey company (Rev. 19:11). In Christ's first coming, yet under the Old Covenant, He rode into Jerusalem on a donkey (Matt. 21:5). But in His second coming, this time under the New Covenant, He is portrayed riding on a white horse. This speaks of the progression from Ishmael to Isaac.
From all of this we can see that Ishmael and Isaac represent companies of people. People are part of the covenant that represents their personal relationship to God and the "mother" that they claim as their own. Judaism claims the Old Covenant as its mother; therefore, Jews are Ishmaelites. But Islam is also an Ishmaelite religion, having all the characteristics of the Old Covenant in its normal practice. So also with most denominational Christianity, although this has been less obvious, due to its verbal claims upon the New Covenant.
In closing, let me say that there is a difference between the Law and the Old Covenant. The Law of God is present in both covenants. Under the Old Covenant, the law was written on external tablets, while under the New Covenant, the law is written on our hearts (Heb. 8:10). The Law has taken a different form, but the principles remain the same.
We should discard the Old Covenant and keep the law as applied in a New Covenant manner. The problem comes when Christian Ishmaelite denominations retain the Old Covenant applications of the law or discard the law altogether. Such people usually go further by supporting Zionism and insisting that Old Covenant Jews are still "chosen" and "heirs to the promise" regardless of their rejection of Jesus Christ. This only serves to support Ishmael in his claim as the heir of Abraham, when in fact his parents are Abram and Hagar.