(July 30, 2008)—Secretary of State Condoleezza Rice was meeting Wednesday with top Israeli and Palestinian negotiators in Washington hoping to salvage some of the modest gains in peace talks that began in 2007.

Both sides have backed off their ambitious goal of inking a peace deal before President Bush leaves office in January.

Now, the State Department says it's striving to reach consensus on "final status issues by the end of the year."

Those unresolved issues include the final borders between Israel and a future Palestinian state, competing claims to the holy city of Jerusalem, the fate of millions of Palestinian refugees and Israeli security concerns.

An agreement on Jerusalem may be wishful thinking.

Israeli President Ehud Olmert has been quoted as saying there's "no practical chance" of reaching an agreement in 2008.