In 2008 you need a passport no matter what. Without one right now before 2008 it is so much of a hassle that it ain't even worth it.I've heardsome horrible stories about bordercrossing. They can legally tear your car apart. I had to wait a few hours one time. My mom had to wait 4-5 hours because she admitted to having a leatherman. Coming back is definitely the hardest part about it. I live close to the border.
I found a story about it.
http://abcnews.go.com/Travel/story?id=3669711&page=1