The U.S. is Running Out of Energy.

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Beth Wilson, a stay-at-home mom in Hobart, Ind., 35 miles southeast of Chicago, is still seething over last winter's bills from Northern Indiana Public Service Co., known as NIPSCO. In March 2002, Wilson paid the utility 33¢ a heating unit for the family's two-bedroom home. By March of this year, the price had shot up to 86¢, an increase of 161%. If the price of new cars had risen at the same pace, a midrange Ford Taurus would sell for $54,000 today. Says Wilson: "I never turn my heat up past 68. I didn't want to turn my ceiling fan on." (NIPSCO also furnishes her electricity.) "How can other people on fixed incomes pay if I can't?"

For consumers, the second part of this one-two punch is exaggerated oil prices. While the world is swimming in crude oil, it already trades at an inflated price of $30 a bbl., a level essentially dictated by Saudi Arabia with the approval of the U.S. government. This translates into swollen prices for gasoline, home heating oil and other petroleum products. What's worse is that because of Congress's three decades of fumbled energy legislation, Americans have become more vulnerable than ever to an interruption in foreign supply that would truly send prices into orbit and cripple the U.S. economy. More than 53% of America's daily consumption of oil and petroleum products comes from foreign sources, compared with 35% in 1973.

Why are Congress and the White House responsible? As part of a long-standing ritual involving Democrats and Republicans, lawmakers and Presidents have devised energy plans that add up to no plan at all--not deliberately but by default. In pursuit of different agendas, competing interests tend to cancel one another out over time, leaving the nation with no coherent direction on energy. Lawmakers launch programs to develop alternative-energy supplies but later quietly cut or eliminate the funding so there are no realistic alternative sources. They enact legislation offering incentives to stimulate crude-oil production in the U.S., when the politicians know--or should know--that the programs will not do so in any significant way. They encourage utilities, businesses and industries to shift to natural gas, then fail to ensure sufficient supplies of the fuel. The lawmakers refuse to make the tough choices on energy supplies and consumption, while they cater to the demands of campaign contributors and special interests. Worst of all, when politicians craft a conservation program that actually works, they abandon it. As a result, after three decades and dozens of energy bills, Congress has helped position Americans so they may be closer to an energy crisis than at any time since the oil shocks of the 1970s. And this time, the U.S. is finally beginning to run out of domestic oil and easily recoverable natural gas. Here is how it happened: