Brad has got it right, the water pump is gone. I had the same problem this week on my 98 SE. Car will warmup like normal, but the needle on the Temp gauge just sails right on up to HOT. There is no hot air from the heater, which indicates no water circulation. Found the impeller had broken completely apart.
If you check the FAQ, you'll see that this (water pump impeller failure) is a typical problem at 50-60k miles. My Contour had 52300 miles on it.
