Does God's discipline of Israel mean He has permanently rejected them?
No. Although God disciplines Israel for unbelief and sin, God declares His mercy will not depart from them as He took it from Saul. He will not destroy the nation or turn His back on them forever; He has set them aside, and they will face great tribulation discipline.
Les teaches that the first word "but" in verse 15 signals the flip side: Israel will commit iniquity, but God says His mercy will never depart from them, unlike what He took from Saul. Regardless of how far Israel falls into wickedness, God will discipline them, including the greatest discipline any people will face when they go through the tribulation, but He is not destroying the nation and has not turned His back on them forever. He has set them aside, as shown on the chart: 2,000 years to Abraham, then about another 2,000 years to Christ's first advent, where God dealt primarily with this favored nation. Even after the crucifixion, Peter addresses Israel in early Acts and pleads with them to respond to the fact that the one they crucified was their Messiah, but nationally Israel rejected it and would not believe, though some did.