Last week's Jerusalem seminary attack, in which eight students were killed, topped the agenda at the weekly meeting of the Israeli Cabinet. Israel also announced plans for new settlement construction in the West Bank, putting further strain on the peace process. Robert Berger reports from the VOA bureau in Jerusalem.

Israeli Prime Minister Ehud Olmert

Prime Minister Ehud Olmert told the Cabinet that the deadly seminary shooting was an attack on the "flagship of religious Zionism." The seminary is a source of inspiration for Jewish settlement in the West Bank, and Mr. Olmert said that is why it was targeted by a Palestinian gunman. He said that for generations, the institution has produced many of Israel's top idealists and soldiers.

The 25-year-old gunman from East Jerusalem stormed into the seminary Thursday and killed eight students, nearly all of them teenagers.

Despite the attack, Israeli officials have indicated that they intend to return to peace talks with the moderate Palestinian government in the West Bank.

But seminary students like David Friedman say that is a bad idea.

"This attack shows that all the Palestinians was a terror group, is still a terror group. You cannot talk to them and you cannot make peace talks with them," he said.

Palestinian President Mahmoud Abbas has also agreed to resume peace talks, which he suspended after a five-day Israeli incursion in the Gaza Strip killed 120 Palestinians. Israel launched the assault in response to daily Palestinian rocket attacks.

Peace efforts suffered another blow when Israel announced plans to build up to 750 new homes in a Jewish settlement in the West Bank, near Jerusalem. Both the United States and the Palestinians say settlement construction harms the peace process.