In 1966, Martin moved his new family to Montréal, where he joined POWER CORPORATION OF CANADA as executive assistant to mentor and president Maurice STRONG (and later, Paul DESMARAIS). Although there was no business experience in the family, Martin displayed a natural entrepreneurial skill. By 1969 he had been appointed vice-president of Power Corp, by 1973, president of CANADA STEAMSHIP LINES, and two years later, CEO. In August 1981 Martin and a business partner bought the company (renamed CSL Group) for $180 million, and by 1988 Martin was sole owner. His creation of an ocean-going fleet equipped with self-unloading technology was highly successful, but other profit-making strategies later became the subject of criticism. They included decisions to build new ships overseas, set up operations in foreign countries, employ low-wage foreign workers, and have his ships operate under so-called "flags of convenience." Although these were standard procedures in the world of maritime commerce, Martin's connections with CSL were used against him when he entered political life.
The elder Martin had often counselled his son, eager to enter politics, to wait until he was well established in business. In 1988, when Martin was 50, he ran in the federal election in the Montréal-area riding of LaSalle-Émard. That year, the Progressive CONSERVATIVE PARTY under Brian MULRONEY swept to its second majority victory, but Martin was one of a strong contingent of Liberals elected to Parliament that year. After Liberal leader John TURNER quit, Martin ran against Jean CHRÉTIEN in 1990 to replace him. One of the major issues of the campaign was the MEECH LAKE ACCORD, which Martin supported and Chrétien opposed. At the Calgary convention that chose a new leader, Martin lost on the first ballot - taking 25% of the vote to Chrétien's 57%. The bitter fight for the leadership marked the beginning of a long and complex rivalry between the two men that eventually threatened the fabric of the LIBERAL PARTY itself.
The Deficit Cutter
By 1994 the Canadian economy was in a deep recession, and in February of that year Martin slashed funding for unemployment insurance and closed several military bases. In 1995, he presented a landmark Canadian budget. Determined to reduce the Canadian deficit, he cut the spending of virtually every federal department, reducing government expenditures by more than $25 billion (spread over three years) and eliminating 45 000 public service jobs. Federal transfer payments to the provinces for health and education were slashed by $7 billion. Though he was criticized for cutting social programs, his popularity was undiminished. The Chrétien government won a second majority in 1997, in no small part on account of Martin's record.
By 1998, Martin had erased the $42 billion deficit he had inherited, establishing a reputation at home and abroad as a fearless "deficit cutter." He achieved a balanced budget for the fiscal year 1997-98, and was later able to present consecutive budget surpluses, expand government spending, and cut income tax rates. The Liberals won again in the election of 2000, another victory that had much to do with Martin's success as the most influential finance minister in decades.
Martin Versus Chrétien
During his years as finance minister, Martin's relationship with Chrétien was strained, but the tensions were usually kept from public view. The two worked closely together, despite having conflicting ideas on some sensitive files, including Québec, the home base of both politicians. Martin was ambivalent in his support for the Clarity Act, one of Chrétien's key pieces of legislation, privately favouring a less confrontational approach to Québec SEPARATISM. By 2002, anticipating Chrétien's retirement, Martin and others had begun campaigning for the Liberal leadership. In the winter and spring of that year, the Liberal government was besieged by accusations of incompetence and corruption, particularly related to the misuse of government funds to sponsor events in Québec. Believing that damaging leaks were being orchestrated from within Cabinet, Chrétien ordered leadership campaigning to stop.
A leadership review, which Liberal Party rules required after each general election, was set for March 2003. By late May 2002, the charges and counter-charges within the Liberal Party about the leaks and other issues dominated Canadian politics. Martin was on the verge of resigning, when, on 2 June 2002, Chrétien fired him. Martin announced that he would continue to sit in the House of Commons as an ordinary MP. In August, Chrétien, no doubt fearing repudiation at the upcoming party convention, announced he would resign from office, but not for another 18 months.
In November 2003, following a campaign in which Martin's victory was never in serious question, he won the leadership by a massive majority (3,242 to 211 votes, or 95% to 5%) over his only remaining opponent, Sheila COPPS. In taking the mantle of Liberal leader, he had succeeded where his revered father, who had tried three times for the leadership over four decades, had failed. Chrétien left earlier than expected and on 12 December 2003, Martin became Canada's 21st prime minister. He rewarded some but not all of his key supporters; Chrétien loyalists were mostly shut out of the top jobs.
Initially, public approval of the new prime minister was stunningly high (64%). Yet, despite 15 years in Parliament, half of them as a high-profile finance minister, Martin was still largely an unknown quantity. To some observers he was an enigma, a politician without fixed policy priorities. To others, including colleagues and friends, he was a man full of intellectual curiosity whose ambition was to transform the government and the country. Although he was accused of being vague on specifics, during his long run for the leadership and after becoming prime minister, he articulated an ambitious number of priorities for his government, promising to create improved ties with the US, a stronger military, and a skilled workforce. He also pledged to reduce health care wait lists and poverty among aboriginal peoples, and to repair what he called "the democratic deficit" in Parliament, expanding the role of backbenchers in government decision making. All this would be done as he cut taxes and reduced the national debt.
"New" Government, Old Scandals
Whatever Canadians' expectations and Martin's own ambitions, Canada's new prime minister inherited a party suffering from the wounds of protracted internecine battles and a government plagued with scandal.
As Martin struggled to set a new agenda, the auditor-general revived the so-called sponsorship scandal in a report outlining the misspending of $100 million in federal funds, some of which had been diverted through government agencies and advertising companies to Liberal supporters in Québec. As the Liberals sank dramatically in the polls, Martin went on the offensive, denying knowledge or involvement and promising to resign if he was proved a liar. He appointed the Commission of Inquiry into the SPONSORSHIP PROGRAM AND ADVERTISING ACTIVITES (GOMERY INQUIRY) to look into what he called "the disgusting mess" and attempted to ally himself with an outraged Canadian public, going on national talk shows and announcing he would punish those responsible.
In February 2004, the prime minister fired ambassador Alfonso Gagliano, who was implicated in the scandal as a former public works minister, and suspended the presidents of the Business Development Bank, VIA RAIL, and CANADA POST. But the scandal and Martin's forceful actions to meet it exacerbated tensions between his supporters and those of former prime minister Chrétien. At the same time, the scandal presented Martin with an opportunity to act on promises to reform the government structure and end the concentration of power in the Prime Minister's Office. Martin pledged that in the future all senior appointments, including those to Crown Corporations and the Supreme Court, would be vetted by Parliament.
The sponsorship affair, however, had severely diminished the popularity of Martin's government. In the election of 29 June 2004, the Liberals were reduced to a minority in the Commons, winning 135 of 308 seats. Lacking an assured parliamentary majority, employing a chaotic system of cabinet decision making, and pursuing countless priorities, Martin seemed to flounder. The bold businessman and finance minister became a very cautious prime minister, so much so that became known as "Mr Dithers" both in Ottawa and internationally.
The first report of the Gomery Commission, released 1 November 2005, exonerated Martin, but his government was damaged by the report, which pointed to the misuse of sponsorship funds and corruption within the Québec wing of the federal Liberal Party. Sensing an opportunity, the opposition parties combined on 28 November to bring down the government and force an election. On 23 January 2006, the Liberals won 103 seats, 21 fewer than the Conservatives. That night, Martin conceded defeat and announced that he would step down as Liberal leader.
Author NORMAN HILLMER and STEPHEN AZZI
Links to Other Sites
First Among Equals
Learn about the private lives and political careers of Canada’s Prime Ministers. Includes biographies, speeches, and other historical documents. A Library and Archives Canada website.
This CBC In Depth feature offers a profile of former Prime Minister Paul Martin. Includes multimedia clips of interviews.
Double Vision: The Inside Story of the Liberals in Power
A review of "Double Vision: The Inside Story of the Liberals in Power" by Edward Greenspon and Anthony Wilson-Smith. From "Quill & Quire."
Summer Jobs Series: How summers spent collecting minimum wage shaped the legacies of Brian Mulroney, Paul Martin
An article that highlights some of the gritty summer jobs held by Canadian prime ministers in their younger years. From the National Post.