By MICHAEL FALCONE ( @michaelpfalcone ) and AMY WALTER ( @amyewalter )

Mitt Romney and Rick Santorum are engaged in an all-out air war in Michigan.

The state has suddenly become ground zero in the Republican nominating contest and both campaigns as well as a pro-Romney super PAC are spending big to try to win there.

The latest volley came this morning when the Santorum team unveiled a startling new television ad featuring a Mitt Romney look-alike shooting at a life-sized cardboard cutout of Santorum with mud pellets.

"Mitt Romney's negative attack machine is back - on full throttle," the ad's narrator says. (The ad is appropriately titled, "Rombo.") http://bit.ly/xNqr1V

The Santorum campaign is hoping to focus voters' attention on the narrative the Santorum campaign would like to use to frame the race ahead of the Feb. 28 primary: Santorum as the underdog taking on the behemoth Romney campaign.

The Romney campaign released an ad of its own yesterday. It focuses on Romney's Michigan roots: "Michigan's been my home," the candidate says in the spot. "This is personal."

But here's a striking fact. The Romney campaign is putting more than $824,000 behind the ad in the state ahead of the primary compared to Santorum's campaign, which is spending just $41,000, according to a source tracking media buys.

Add to that the more than $850,000 the pro-Romney super PAC, Restore Our Future, has already spent on television advertising in the state and the picture of just how hard Romney and his allies are fighting becomes clear.

Restore Our Future is getting into the anti-Santorum action too. The group released an ad last night hitting Santorum hard over the issue of earmarks. Separately, the Romney campaign is organizing a conference call today on what they say is "Rick Santorum's record of increasing government spending and earmarks."

Despite the sparring on the television airwaves, neither campaign is interested in raising expectations in the Great Lakes state. In fact, quite the opposite. But the money both sides are shelling out in the final two weeks speaks volumes about the high stakes in Michigan.

STATE OF THE RACE:  "For Mitt Romney and Rick Santorum, Michigan may be their political Gettysburg. If Romney loses in his native state, where his father was governor, it would be a defeat from which he might not recover," Bloomberg's John McCormick writes.  "The makeup of the Republican electorate, which is likely to be one-third Catholic and opposed to abortion, will help Santorum offset the allegiance Romney draws from supporters who delivered his 2008 presidential primary win over John McCain. Anything short of a win in the Feb. 28 primary would be an embarrassment for Romney's presidential ambitions. 'It would be a huge disappointment to Romney if he doesn't win this state by a substantial margin,' said Bill Ballenger, editor of the Inside Michigan Politics newsletter. 'If he blows this, he's really in trouble.' This may be Santorum's best chance to derail the candidate who Republicans perceived as having a better shot to win the nomination and challenge President Barack Obama in November because of an advantage in money and organization. Romney, 64, won the state's primary four years ago with 39 percent of the vote, defeating McCain, the party's eventual nominee." http://bloom.bg/zualTv

ABC's David Muir reported for "Good Morning America" on Romney's attempt to tout his home-state credentials. Romney arrives in Michigan today for campaign events in Grand Rapids and Santorum will be stumping there on Thursday. WATCH: http://abcn.ws/zBLP9h

MICHIGAN PORTRAIT: AN IMPROVING ECONOMY. "At Nicky D's Coney Island in Warren, Mich., across the street from a Chrysler truck plant, co-owner Diana Dedvuka has seen her bustling diner come back from a near-death experience," ABC's Chris Bury notes. "'People are working.  They're spending more money. Customers seem to be happier,' she said. In 2009, the family-owned restaurant struggled to stay open as Chrysler and General Motors teetered on the brink of collapse. … As Republicans Rick Santorum and Newt Gingrich scramble to overtake native son Mitt Romney in the Michigan primary, scheduled for Feb. 28, the state's economy appears to be climbing out of a deep, dark hole. 'Since the depths of the recession, we've seen manufacturing stabilize and start to come back,' said Robert Dye, chief economist for Comerica Bank. 'What we've seen in the auto industry lately has been good news for the state.' In fact, it's been very good news:  Tax revenues have jumped so dramatically that Michigan now enjoys a $457 million budget surplus." http://abcn.ws/zPDfAz

PAYROLL TAX CREDIT BREAKTHROUGH. Multiple Capitol Hill sources said last night that a deal has "come together" to extend the payroll tax credit for the rest of the year, reports ABC's Sunlen Miller. The deal, close to being formally struck but not yet finalized, would extend the payroll tax credit for the rest of the year. Two other expiring policies - unemployment benefits and the "doc fix" to exempt doctors who treat Medicare patients from getting a pay cut - would also be extended under the negotiated proposal. The payroll tax credit portion of the deal would not be offset with the cost of spending cuts elsewhere. The other provisions would be offset by a combination of non-controversial spending reductions, which are still being ironed out now. Several House and Senate aides close to the negotiation confirm that while it's still "premature" to say there is a final deal, "there are signs of progress." The bill would still move through the conference committee, which has until now seemed deadlocked. http://abcn.ws/w7oVib

On "Good Morning America" today, ABC's Jake Tapper took a closer look at how the deal came together and what it will mean for American workers the unemployed. WATCH: http://abcn.ws/wzBDso

THE BUZZ

WHY NEWT GINGRICH ISN'T GOING ANYWHERE. The chances of Gingrich losing his ego and quitting the race before he absolutely he has to are lower than that of Michele Bachmann getting back in the race and winning the primary, ABC's Matt Negrin notes. A half-dozen influential conservative leaders who haven't endorsed a candidate suggested in interviews that while stepping aside would help Gingrich now more than ever, nobody really expects him to do so. "If, in fact, Gingrich was being anything other than Gingrich, that might be a wise move, but you don't actually think that's going to happen," said David Keene, the president of the National Rifle Association. "It's all about Newt." There isn't a single primary or caucus until Feb. 28, when voters in Michigan and Arizona go to the polls. If Romney wins both contests solidly, he'll head a week later into Super Tuesday, the biggest primary event of the year, with first-place status. But if Santorum can pull off a win in Arizona or in Michigan, where polls put him right up there with Romney, then Super Tuesday could become a contest with no clear front-runner going in. But thinking that Gingrich could endorse Santorum before Feb. 28 assumes that the former House speaker is more interested in Romney being beaten than being president himself. "This is Newt's chance to be Winston Churchill. He's not interested in being the unknown conservative leader to step aside," said a prominent conservative who asked not to be named because he works with the candidates. "If you're Newt Gingrich, you could live with losing to Romney. You can't live with losing to Santorum." http://abcn.ws/vZDBjN

THE RETURN OF SHELDON ADELSON? "Billionaire Sheldon Adelson, by far the biggest financial backer of Newt Gingrich's presidential bid, is preparing to open his wallet again. But this time, the casino magnate appears to have more than one agenda," reports the Wall Street Journal's Alicia Mundy and Alexandra Berzon. "In a bit of political chess, Mr. Adelson is ready to not only directly support the former House speaker in the Republican primary, but to use his cash to push Rick Santorum from his position atop the latest national polls, according to people who have discussed the matter with Mr. Adelson. If Mr. Gingrich could afford to continue campaigning, one of those people said, he might be able to draw off conservative and evangelical voters from Mr. Santorum, improving the chances of Mitt Romney, who Mr. Adelson believes has a better chance to win November's general election. According to the people who have discussed the matter, Mr. Adelson could give an additional $10 million or more to an independent group supporting Mr. Gingrich before Super Tuesday, March 6, a likely pivotal day when 10 states go to the polls. The Adelson family has already given $11 million to support Mr. Gingrich since December." http://on.wsj.com/ybb0TX

RICK SANTORUM'S BENEFACTOR ISN'T GOING ANYWHERE. ABC's Shushannah Walshe reports: With his candidate of choice riding high in the polls, Rick Santorum's wealthy benefactor Foster Friess laughed off the suggestion that he's buying the election for the former Pennsylvania senator, but Friess, the main donor to the pro-Santorum super PAC told ABC News he is absolutely committed to helping Santorum through Super Tuesday and all the way through the Republican National Convention in August. However, the always colorful Friess acknowledged that because of increased fundraising by the campaign since Santorum's surprise trifecta win in Missouri, Minnesota, and Colorado last week his help isn't needed as much. "The wonderful news is they don't really need me," Friess said on the phone from where he lives in Jackson Hole, Wyoming. "They raised $3 million in three days (for the campaign.) There was an $800,000 day for the super PAC, so my resources - they are in the back corner waiting if they are needed, but it doesn't look like they need."  When asked if he sees himself committing the kind of money other super PAC donors have given in support of candidates, such as the $10 million casino mogul Sheldon Adelson and his wife gave to Newt Gingrich's super PAC, Friess said he will "play as we go along." http://abcn.ws/AFqkJY

NOTED: SECRET SERVICE COMING TO SANTORUM WORLD? Rick Santorum said Tuesday evening "for the sake" of his family he is in talks to possibly acquire Secret Service protection. "We are talking about that right now," Santorum told reporters before referring to events that transpired Monday evening. "It's unfortunate that we are in that situation where folks can get a little rowdy and sometimes a little violent and so it's sort of a sad state of affairs. I've been driving around most of this campaign in a truck with one other person, but we are in a different phase and obviously just for the sake of my family that we have to consider so we are in that discussion right now."  http://abcn.ws/yMFDwt

RON PAUL MONEY BOMB RAISES $1 MILLION-PLUS. Ron Paul kicked off his "No One But Paul" money bomb on Valentine's Day. ABC's Jason Volack notes that as of this morning, the congressman raised a little over a million dollars. Although the Texas Republican has not set a fundraising goal for his latest money bomb, he is faced with 14 elections between now and March 6th that will demand a considerable amount of cash. Revolution PAC, a pro-Ron Paul super PAC, has announced a "Ron Paul Powercast" in order to raise $1 million to run ads in key election states in the days leading up to Super Tuesday. The "Million Dollar Marathon," which will take place on February 25th, will feature a 12-hour broadcast with a 24-hour fundraising goal of $1 million.

NOTED: Sen. Rand Paul in an interview with The Atlantic says his father has "got to start winning some primaries." He was asked if his father truly has a route to victory in the Republican primary. Rand said wait until mid March "when you'll have 10 or 15 states done and then we can see where things are. But to win, he has to win some states." He also dodged a question of whether his father is being well served by his campaign staff. http://bit.ly/ACGNcJ

L.A. MAYOR TO CHAIR DEMOCRATIC CONVENTION.  "Los Angeles Mayor Antonio Villaraigosa has been selected chairman of this summer's Democratic National Convention, elevating his role as a surrogate in the Latino community and raising his national profile at a time Villaraigosa considers his political future," The Los Angeles Times' Mark Z. Barabak and John Hoeffel write. "A formal announcement was scheduled Wednesday in Washington, with the mayor planning to join President Obama on Wednesday night for a presidential fundraiser in Los Angeles. As convention chairman, Villaraigosa will wield the gavel during the event in Charlotte, N.C., which opens with a festival on Sept. 3 and continues for three days of official business, including the nomination of Obama and his acceptance speech."  http://lat.ms/zVQ7IY

WHO'S TWEETING?

@JohnJHarwood : OK, what's more improbable feel-good story - Linsane game-winning three at the buzzer, or bloodless Dem-GOP compromise on payroll tax cut?

@politicalwire : Is Mitt Romney really more electable than Rick Santorum? pwire.at/xi2i1R

@HotlineJosh : My latest column RT  @JillDLawrence . @HotlineJosh says super PACs are good for democracy & makes a darn good case.  bit.ly/wD1dDs

@ByronYork : Santorum vowed that as president he would fight 'the dangers of contraception.'  ow.ly/95a6Q

@robertcostaNRO : morning must-read:  @DavidMDrucker's report from inside the Senate GOP cloakroom  rollcall.com/issues/57_96/J…

POLITICAL RADAR:

- Mitt Romney holds a roundtable on jobs and a rally in Grand Rapids, Michigan.

- Rick Santorum hosts an energy roundtable in Tioga, North Dakota and a rally in Fargo.

- Newt Gingrich and Ron Paul have no public events scheduled.

Check out The Note's Futures Calendar:  http://abcn.ws/ZI9gV

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