FIRST LOOK – New Yorker Editor DAVID REMNICK, “Letter from Jerusalem … THE PARTY FAITHFUL: The settlers move to annex the West Bank—and Israeli politics … Israel’s new hard-liners: The face of the emerging religious right is young, tech-savvy, and uncompromising. With the center-left in disarray, has the settler movement taken over Israeli politics? … Ayelet Shaked and Naftali Bennett … are running for the Knesset in the Jewish Home Party. Bennett says, ‘There will never be a peace plan with the Palestinians’”:

“The Israeli elections will be held on January 22nd. [Prime Minister Benjamin] Netanyahu is almost sure to keep his position. But that is not the central story of this political moment. Naftali Bennett is. His party, Habayit Hayehudi (the Jewish Home), represents the merger and reinvigoration of two older religious parties, and it is rapidly gaining ground. Many expect a third-place finish, behind Labor, which would be a remarkable achievement; second place is not inconceivable.

“More broadly, the story of the election is the implosion of the center-left and the vivid and growing strength of the radical right. … Israel’s hard-liners harden further. The Palestinians grow more frustrated. Talk of a binational state increases. All parties wait for the White House, but why would an American President think that he could present his own initiative and muster enough support on all sides to succeed? Why, he asks himself, should he spend the political capital? Courage is discouraged.”

GEN. COLIN POWELL, to David Gregory on NBC’s “Meet the Press”: “There's … a dark vein of intolerance in some parts of the [Republican] party.  What do I mean by that?  What I mean by that is they still sort of look down on minorities.  How can I evidence that?  When I see a former governor [Sarah Palin] say that the president is shuckin' and jivin'. That's a racial-era slave term.”

POWELL, on the nomination of former Sen. Chuck Hagel for Defense Secretary: “It might be useful just to stand back and take a look at this man overall: A young man who volunteered to go to Vietnam. … He was wounded twice. He came back from Vietnam, he went to school under the G.I. Bill … He supported President Reagan in his run for office, and … received a deployment as deputy director of the Veterans Administration. To show you the kinda courage this guy has, … he quit after one year because he felt the Veterans Administration was not doing a good job for veterans …  He knows what war is, and he will fight a war if it's necessary. But he's a guy who will do it with great deliberation and care. … He is a fellow he speaks his mind.  He sometimes gets in trouble with those who thinks he should not speak his mind, but he says what he believes and he sticks with it.”

SEN. BOB CORKER (R-Tenn.), new ranking member of the Senate Foreign Relations Committee, to George Stephanopoulos on ABC’s “This Week,” re the committee’s confirmation hearing for Sen. Hagel: “[A]nother thing … that's going to come up is just his overall temperament, and is he suited to run a department or a big agency or a big entity like the Pentagon … I think there are numbers of staffers who are coming forth now just talking about the way he has dealt with them.”

--A senior administration official emails Playbook: “This line of attack is a new low.  By contrast, Sen. Hagel intends to take the high road in the confirmation process as he defends his strong record.”

THE NEXT CLIFF – EZRA KLEIN, “Treasury: We won’t mint a platinum coin to sidestep the debt ceiling”: “The Treasury Department [announced yesterday that it] will not mint a trillion-dollar platinum coin to get around the debt ceiling. If they did, the Federal Reserve would not accept it. … For the platinum coin idea to work, the Federal Reserve would have to treat it as a legal way for the Treasury Department to create currency. If they don’t believe it’s legal and would not credit the Treasury Department’s deposit, the platinum coin would be worthless.  … The idea of minting a trillion-dollar platinum coin was first floated in May 2010, in the comment section of ‘The Center of the Universe,’ a blog devoted to Modern Monetary Theory. The author was a lawyer writing under the pseudonym Beowulf.  …

“The platinum coin idea … developed traction following the 2012 fiscal cliff deal, as politicians and economics writers realized that the country would, indeed, be facing another debt-ceiling crisis in a matter of months. … The administration’s position is that raising the debt limit is Congress’s responsibility until the day that Congress votes to make it the White House’s responsibility, which is a resolution the Obama administration would happily accept. Until then, White House officials say, they will not negotiate over the debt ceiling, and if congressional Republicans attempt to use it as leverage, then the consequences will be theirs to bear.” http://wapo.st/13rJtGS

--PLAYBOOK BACKSTORY: The White House didn’t take the blogs’ platinum-coin rants seriously at first, but decided to do due diligence as the idea gained traction. Treasury and the Fed looked at the question independently and came to the same conclusion: It wouldn’t work.

--White House “Statement by the Press Secretary on the Debt Limit,” yesterday afternoon: “There are only two options to deal with the debt limit: Congress can pay its bills or it can fail to act and put the nation into default.  When Congressional Republicans played politics with this issue last time, putting us at the edge of default, it was a blow to our economic recovery, causing our nation’s credit rating to be downgraded.  The President and the American people won’t tolerate Congressional Republicans holding the American economy hostage again simply so they can force disastrous cuts to Medicare and other programs the middle class depend on while protecting the wealthy.  Congress needs to do its job.”

THE NEW AGENDA – N.Y. Times 1-col. lead, “OBAMA WILL SEEK CITIZENSHIP PATH IN ONE FAST PUSH: IMMIGRATION OVERHAUL – Resists Plan Favored by Rubio to Tackle the Issue Piecemeal,” by Julia Preston: “Obama and Senate Democrats will propose the changes in one comprehensive bill, the officials said, resisting efforts by some Republicans to break the overhaul into smaller pieces — separately addressing young illegal immigrants, migrant farmworkers or highly skilled foreigners — which might be easier for reluctant members of their party to accept.  The president and Democrats will also oppose measures that do not allow immigrants who gain legal status to become American citizens one day … The White House will argue that its solution for illegal immigrants is not an amnesty, as many critics insist, because it would include fines, the payment of back taxes and other hurdles for illegal immigrants who would obtain legal status …

“The president’s plan would also impose nationwide verification of legal status for all newly hired workers; add visas to relieve backlogs and allow highly skilled immigrants to stay; and create some form of guest-worker program to bring in low-wage immigrants in the future. … White House officials and Democratic leaders in the Senate have been negotiating over which of them will first introduce a bill … Schumer and Senator Lindsey Graham of South Carolina, a Republican, have been meeting … to write a bill. Republicans who have participated include John McCain of Arizona; … Jeff Flake, also of Arizona, who is newly elected to the Senate; and Mike Lee of Utah. Senator Marco Rubio of Florida participated in one meeting last month. Democrats in the meetings include Richard J. Durbin of Illinois, the No. 2 Senate Democrat; Robert Menendez of New Jersey and Michael Bennet of Colorado.” http://nyti.ms/ROxdMM

EDITING WITH AN iPHONE? N.Y. Times Corrections today: “Three passages [in a Magazine article about Lindsay Lohan] are … rendered incorrectly because the word ‘tested’ appears instead of ‘texted.’”

**A message from the U.S. Chamber of Commerce: The U.S. Chamber of Commerce has an ambitious new agenda to generate stronger, more robust economic growth, create jobs, and expand opportunity for all Americans. Learn more about the Chamber's American Jobs and Growth Agenda at http://www.uschamber.com/issues. **

SIGN OF THE TIMES: The number of NYSE market makers and traders working on the floor has fallen from 3,000 in 2007 to 300 today, per today’s N.Y. Post.

MASS. SENATE SPECIAL-- “Ed Markey Hires Campaign Manager Sarah Benzing” – Release datelined Medford: “Rep. Ed Markey (D-Malden) … announced that … Sarah Benzing will be managing his campaign for the U.S. Senate. Benzing managed the winning 2012 Sherrod Brown for Senate campaign in the tough battleground state of Ohio. She joins Elizabeth Warren for Senate campaign finance veterans Colleen Coffey and Michael Pratt on the Markey campaign. … Benzing also managed the Kristen Gillibrand for Senate campaign in 2011.”

THINGS THAT WORK – “Long-Term Unemployed Begin to Find Work,” by WSJ’s Ben Casselman (ran Fri., p. A2): “The long-term unemployed—those out of work more than six months—made up 39.1% of all job seekers in December, according to the Labor Department, the first time that figure has dropped below 40% in more than three years. … In the past year, the number of long-term unemployed workers has dropped by 830,000, accounting for nearly the entire 843,000-person drop in overall joblessness. … The gradual strengthening in the housing market could lead to more improvement. Many of the long-term unemployed are former construction workers who lost jobs when the housing bubble burst. Rising home building has yet to lead to a surge in construction employment, but many experts expect hiring to pick up in 2013.

“Another possible factor behind the recent progress: the gradual reduction in emergency unemployment benefits available to laid-off workers. During the recession, Congress extended unemployment benefits to as long as 99 weeks in some states. Today, benefits last 73 weeks at most, and less time in many states. Research suggests that unemployment payments lead some recipients not to look as hard for jobs, and the loss of benefits may have pushed some job seekers to accept work they might otherwise have rejected, said Gary Burtless, an economist at the Brookings Institution.”

THINGS THAT DON’T WORK – Boston Globe banner, “From ‘rural’ Nantucket, a golden harvest for Mass.: Other states take aim at special Medicare rule for island’s tiny hospital that funnels hundreds of millions to other institutions,” by Tracy Jan: “Nestled on an island 30 miles out to sea, Nantucket Cottage Hospital is the only rural hospital in Massachusetts, as deemed by the federal government. Its weathered cedar shingles and widow’s walk evoke the bygone era of its founding a century ago, when the hospital consisted of just three tiny cottages. But the 19-bed hospital on the tony island … has become a national symbol of inequity and political machinations in the way the federal government reimburses hospitals for treating Medicare patients. … Nantucket Cottage’s rural designation has allowed the state’s 81 other hospitals to collectively reap between a $256.6 million and $367 million annual bonus for the last two years … Now a coalition of 21 states is seeking to reverse the windfall, calling it the ‘Bay State boondoggle’ … the artful manipulation of obscure payment formulas.”

REMEMBERING EUGENE PATTERSON – Tampa Bay Times 1A, “Voice of conscience: The former Times editor championed civil rights and excellence,” by Robert W. Hooker, a Times reporter and editor for 40 years: “Eugene Patterson, a journalist who crusaded for civil rights in American society and higher standards in America's newsrooms, died Saturday after a long illness. The former editor, chairman and chief executive officer of the Times was 89. During his 41 years in journalism, Mr. Patterson won a Pulitzer Prize for editorial writing .. and led the Times through an era of rapid growth and recognition by Time magazine as one of America's 10 best newspapers. In the early 1960s, Mr. Patterson wrote courageous columns for the Atlanta Constitution exhorting whites to acknowledge their responsibility for the racial fracture of the South. His most famous piece ran after four young black girls died in the Birmingham church bombing in 1963. ‘If our South is ever to be what we wish it to be,’ he wrote, ‘we will plant a flower of nobler resolve for the South now upon these four small graves that we dug.’ … Patterson expanded the Times' local and foreign coverage, and imbued his staff with higher standards on reporting, writing and ethics. …

“It was Churchill's resignation in 1954 that produced what Mr. Patterson called the favorite ‘lead’ … After watching a tearful Churchill turn over the seals of office, Mr. Patterson crafted a story that began: ‘The blood and sweat part of glorious history now, Sir Winston Churchill resigned in tears today as British prime minister.’ … In 1968, Mr. Patterson left Atlanta for Washington, D.C., where for three years he was managing editor of the Washington Post. It was a heady time to be a newspaper executive in the nation's capital, which was caught up in the presidency of Richard M. Nixon, the Vietnam War and the Pentagon Papers case. But Mr. Patterson grew restless playing second fiddle to the Post's domineering executive editor, Benjamin C. Bradlee, and eventually left. It was in Washington that Mr. Patterson grew to know Nelson Poynter, the chairman and principal owner of the Times. The Pattersons lived close to Poynter's apartment in Washington, and the two men became … philosophical soulmates. …

“Nothing Poynter ever did was more extraordinary than his ultimate disposition of the Times and Evening Independent (an afternoon paper he bought in 1962). He feared that, at his death, his heirs would be forced to sell the papers to pay the estate taxes, and that the papers might then become the property of a chain. Poynter's solution was to create a nonprofit educational institution, now called the Poynter Institute for Media Studies, to which he left the majority of the newspapers' stock.. … Sue Patterson, Mr. Patterson's wife of 48 years, died in 1998. Survivors include his daughter, Mary Patterson Fausch of Raleigh, N.C. and St. Petersburg … Burial will be in Arlington National Cemetery.” http://bit.ly/Y3CcwH

WEEKEND WEDDING: In a sunset beach ceremony on the Riviera Maya in Mexico, Kendra Barkoff and Jonathan Lamy traded “I do”s yesterday. Kendra, press secretary to Vice President Biden, and Jonathan, head of Recording Industry Association of America  public affairs, celebrated with friends, family and a mariachi band. Nieces and nephews did a surprise “Gangnam Style” choreographed dance.

--SPOTTED: CNN’s Kate Balduon; “Meet the Press” producer Adam Verdugo; Cary Sherman, RIAA chairman and CEO; Kate Kelly, Interior's Director of Communications; Christina Mulka, Durbin’s deputy communications director; CNN’s Trish Turner; and many more.

SPOTTED, at last night’s surprise 40th birthday party for Mercedes Schlapp (Matt tented the yard and hired the band “Blame It On Jane”; the Schlapp daughters performed “One Direction's "What Makes You Beautiful”: Ken Mehlman, Barry Jackson, Luke Frans, Taylor and Amy Gross, Mark and Emily Lampkin, Chris Steirwalt  and Mary Diamond Steirwalt, Ben and Joanne Ginsburg, Ken and Jennifer Lisaius, Angela Flood, Brett and Ashley Kavanaugh, Jeannie Mamo, Todd Tiahrt, Ed Gilroy, Sen. Pat Roberts and Frankie Roberts, former Sen. Tim Hutchinson, Jackie Arends,  Julie Cram, Claire Buchan, Jonathan Martin and Betsy Fisher Martin, Allen and Listin Soba, Reg Brown, Melissa Bennett, Kristen Silverberg.

BIRTHDAYS: Arthur Mehlman, father of Ken, is 71 … Kristina Schake, the first lady's communications director … Mia Walton, U.S. Chamber’s vice president of communications and strategy (hat tip: Blair Latoff Holmes) … Lisa Caputo, celebrating with a family ski weekend ... Mary Podesta … Laurence Wildgoose, OFA's Director of Scheduling for Florida (h/t Mara Sloan) … Nick Butterfield … Tali Stein … Anna Lidman … Grace Cowie … Sally Pederson … David Rosen … Liz Schilling … Dave O’Brien … Chris Taylor (h/ts Teresa Vilmain) … Nick Clooney is 79 … Rip Taylor is 79 … Julia Louis-Dreyfus is 52 … Trace Adkins is 51 … Patrick Dempsey is 47 … Orlando Bloom is 36 (h/ts AP)

BIRTHWEEK (was Friday): Walter R. Mears (“What's the lead, Walter?”), retired AP Pulitzer Prize winner, who set the standard for generations of political reporters, including some who may not know of him or his work, is 78.

**A message from the U.S. Chamber of Commerce: The economy is not growing fast enough to create the jobs we need to reemploy the unemployed and create new opportunities for young Americans just starting out. We can boost growth and jobs by producing more domestic energy, expanding trade, modernizing our infrastructure, and reforming our tax, regulatory, and immigration systems. Higher growth won't solve all of our problems, but we can't solve any of them without it. Learn more about the Chamber's American Jobs and Growth Agenda at http://www.uschamber.com/issues. **