Obviously this is a huge question. Behind this question lies the need for discussion on a variety of topics, such as the sovereignty of God and the depravity of man. I could happily point you towards some reading material that could better answer these other topics, one being The Potter’s Freedom by James White, the book from which I drew the insight for my status.
I will, however, attempt the beginnings of an answer by using an illustration from the Bible. The book of Exodus details the mighty working of God to free His people from the cruel bondage of the Egyptian Pharaoh. Before Moses has even set foot before Pharaoh, we read these words:
[Then the Lord said to Moses]…"But I will harden Pharaoh's heart that I may multiply My signs and My wonders in the land of Egypt. "When Pharaoh does not listen to you, then I will lay My hand on Egypt and bring out My hosts, My people the sons of Israel, from the land of Egypt by great judgments. (Exo 7:3-4)
Then follow ten plagues, after each of which we read either that Pharaoh hardened his heart or that God hardened his heart. When Pharaoh ‘hardens his own heart’ we read “as the Lord had said” (7:13; 7:22; 8:15; 8:19). This should be taken to mean that God is the one doing the hardening, because He had said in advance that He would be the one to harden Pharaoh’s heart (7:3). (For an in-depth look at how this is so, check out this sermon by John Piper).
The climax of the Exodus story results in the deaths of all the firstborn sons of Egypt followed by the cataclysmic destruction of the Egyptian army and Pharaoh himself as God brings the waters of the Red Sea crashing down upon them, after the Israelites have safely crossed on dry land.
Does God create people with no hope of salvation? I believe the answer to that question is yes. Why do I say this? Consider Pharaoh – Can we read this story and believe that there was hope of salvation for him? Can we believe that there was any chance that he would repent of his sin and let the people of Israel go? I do not believe that this is so, and the reason is given to us:
"For if by now I had put forth My hand and struck you and your people with pestilence, you would then have been cut off from the earth. "But, indeed, for this reason I have allowed you to remain, in order to show you My power and in order to proclaim My name through all the earth. (Exo 9:15-16)
God could have cut Pharaoh down at any moment. Yet He had a greater purpose in mind for him. His destruction showed the Israelites and the rest of the world God’s power, and caused them to fear His name. The destruction of Pharaoh resulted in the salvation of Rahab.
It is this verse in Exodus that Paul quotes in Romans 9 in response to a question that goes behind your own question: “There is no injustice with God, is there?” (Rom 9:14). Paul then goes on to explain the freedom of God, that being that "I WILL HAVE MERCY ON WHOM I HAVE MERCY, AND I WILL HAVE COMPASSION ON WHOM I HAVE COMPASSION."
He goes on to say, “So then it does not depend on the man who wills or the man who runs, but on God who has mercy. “(Rom 9:16). The “it” is referring back to verse 11, where this whole idea began, with God choosing Jacob over Esau – the “it” is referring to God’s purpose according to His choice, or according to His election. God is free to choose Jacob to be the heir and Esau not to be the heir.
Paul then follows with the verse concerning Pharaoh. God’s electing purpose displays His power, and also has evangelical implications – that His name would be proclaimed throughout the earth. He then says the same thing he said in verse 15 in the negative - So then He has mercy on whom He desires, and He hardens whom He desires (Rom 9:18). To line them all up, God has mercy on whom He desires, He has compassion on whom He desires, and He hardens whom He desires. God is free to act in whatever manner with His people that He desires.
Paul anticipates the objection that arises from such a teaching, thus he says, “You will say to me then, "Why does He still find fault? For who resists His will?" (Rom 9:19). If God willed the destruction of Pharaoh and so hardened his heart to the extent that he could not repent of his sinful behavior, then how can it be said that Pharaoh is at fault – after all, God was the one who hardened him to that end!
Paul response to this objection with possibly one of the most terse statements in all the Bible: On the contrary, who are you, O man, who answers back to God? (9:20). In essence, Paul is saying that anyone, as a human, has no right or authority to question God and the way that He does things. God is God, and humans are not God, and therefore the attempt to accuse God of wrongdoing is invalid.
Then what follows is the key concept to the James White book I mentioned earlier. That is that God is the Potter, the sovereign creator of all things, including us humans. We are but clay in His hands, formed as He wishes to form us, for whatever purpose He wishes to form us for:
The thing molded will not say to the molder, "Why did you make me like this," will it? Or does not the potter have a right over the clay, to make from the same lump one vessel for honorable use and another for common use? What if God, although willing to demonstrate His wrath and to make His power known, endured with much patience vessels of wrath prepared for destruction? And He did so to make known the riches of His glory upon vessels of mercy, which He prepared beforehand for glory, (Rom 9:20b-23).
One thing is certain from this passage: God has created vessels of wrath which He has prepared for destruction. He has also created vessels of mercy which He has prepared for glory. How can this be taken any other way, than to say that some are created without the hope of salvation? If something has been purposefully created by God to be destroyed, what are we to say? We should note also that God does not create vessels of destruction without a purpose – these that are destroyed make known the riches of His glory upon vessels of mercy. This is true of Pharaoh – His destruction, which was determined beforehand, was determined so that the riches of God’s glory would be known among the Israelites, as well as among the rest of the world.
This is where my status stemmed from. Because the question that often arises from this teaching is, “Why then should we evangelize? Why then should we pray for other people?” For if God has already determined who is going to be destroyed and who will see glory, then doesn’t that negate the usefulness of preaching the gospel to unbelievers? To which I give a heartfelt “No.” Quite the opposite – this should give us a greater zeal to preach the word to unbelievers. For we do not know whom the Lord will save. It is not our job to worry about who will be saved and who will not – it is our job to preach the word of truth in accordance with Scripture. Paul says in chapter 10:
...for "WHOEVER WILL CALL ON THE NAME OF THE LORD WILL BE SAVED." How then will they call on Him in whom they have not believed? How will they believe in Him whom they have not heard? And how will they hear without a preacher? How will they preach unless they are sent? Just as it is written, "HOW BEAUTIFUL ARE THE FEET OF THOSE WHO BRING GOOD NEWS OF GOOD THINGS!" However, they did not all heed the good news; for Isaiah says, "LORD, WHO HAS BELIEVED OUR REPORT?" So faith comes from hearing, and hearing by the word of Christ. (Rom 10:13-17).
We are sent to speak the word of Christ to unbelievers. That is our role, to which we must be obedient. Whether they receive mercy or compassion or hardening is up to God.