We usually think of innovation as a matter of coming up with new ideas. But most of the hard work of innovation really lies in getting everyone across all of society to adopt the ideas we’ve already come up with. We already have grids, utilities, homes, cars, and a whole economic infrastructure set up around the assumption that we’ll be using fossil fuels. Switching over to the green alternative requires enormous up-front costs. We’re not talking about getting one “green energy” price point to drop lower than one “fossil fuel energy” price point. We’re talking about getting a swarm of millions of price points to drop lower than another swarm of millions.

So we’ll still need a price on carbon — via either a carbon tax or a cap-and-trade system — to make the crossover happen as rapidly as possible. And we’ll need massive amounts of public spending on green energy to get households and utilities over the initial investment hump. (Remember that sunlight and wind are costless, so once you’re over that initial hump, the energy is free.) The good news is that all signs suggest that lots more deficit spending by America and Europe is exactly what’s needed to get the global economy back on its feet. Global investment in green energy is a perfect opportunity to do just that.

Even better: The effect of this sort of deficit spending would be to boost employment and raise inflation back to a healthy level, which in turn would re-balance global trade flows and start closing the United States’ trade deficit. That would move us back to the way global trade is supposed to work: where poor countries run trade deficits with rich ones to bring in the resources to develop their economies.