(File photo by Capitol Media Services)

We seem to have two choices to solve the state’s budget crisis — slash more than a $1 trillion from education (that’s billion with a “t”), or borrow up to our eyeballs and hope the Santa Claus in Washington delivers Christmas in February.

Outgoing Gov. Janet Napolitano released her final budget proposal this morning. On paper, it eliminates a $1.2 billion deficit this year (although legislative budget experts now predict a $1.6 billion gap) and a nearly $3 billion deficit for the next fiscal year. Her numbers claim she would reduce state spending by $975 million over the two years. But Napolitano couldn’t find a single program or state worker that Arizonans can live without during this deep recession.

Instead, she managed to find new accounting gimmicks such as postponing, but not eliminating, payments to the public universities and state Medicaid insurance program. She also would borrow more by pledging future tobacco settlement money and lottery revenues.

As uncomfortable as many of these proposals are to fiscal conversatives, the alternative that Republican budget-writers have come up with includes slashing $900 million from K-12 education or 20 percent of total state spending. Rufus Glasper, chancellor of the Maricopa County Community College District, has started to prepare for the possibility of losing all state aid for the largest system of its type in the country.

Dire days for Arizona, indeed.