The House

Paul Martin blasts NDP for move to 'far right'

Former Prime Minister Paul Martin defends the Liberals' plan to invest in infrastructure and run at least three more deficits. He also criticizes the NDP's commitment to immediately balance the budget, saying it moves the party to the far right of the political spectrum.

Former PM says NDP's commitment to balanced budgets moves party to far right of political spectrum

Former prime minister Paul Martin hit the campaign trail with Liberal Leader Justin Trudeau this week. (Ryan Remiorz/Canadian Press)

The Liberals' new $125 billion infrastructure plan got a strong endorsement from former prime minister Paul Martin this week, who said the investment is necessary to stimulate the economy while rejecting suggestions that his party is positioning itself to the left of the NDP with its willingness to run deficits.

"I don't understand what Tom Mulcair and the NDP are talking about. If the NDP has decided to move to the far right, so be it — that's their decision. They're the ones who have moved," Martin told host Chris Hall in an interview on CBC Radio's The House

Tom Mulcair defended his commitment to balanced budgets at a campaign rally in Montreal on Friday.

"They [Harper and Trudeau] both want to live for today and let tomorrow take care of itself," Mulcair said.​

"There's a reason we want to be good public administrators with balanced budgets, because if we're not then we're not going to be able to have the types of programs that we all believe in going into the future."

Martin — the former finance minister who returned Canada to balance in the 1990s, and produced five consecutive surpluses — has taken on the role of deficit defender in the wake of Liberal leader Justin Trudeau's announcement that he would double Canada's spending on infrastructure and run three straight deficits if elected.

The Liberal fiscal plan would see "a modest short-term deficit" of less than $10 billion for each of the first three years before returning to balance by the 2019-20 fiscal year.

Martin said he doesn't see his support of the plan as ironic given his own track record of surpluses.

"Growth is the fastest way to eliminate a deficit," he told Hall. "When your debt ratio is sound, clearly the time to invest is when interest rates are low, when labour is available. So this is very much part of what the Liberals did in the '90s."

Investing in infrastructure the 'answer to deficit'

The Liberals' plan to spend $125 billion on new infrastructure — about twice the amount the Conservatives have committed — would focus on three areas: public transit, social infrastructure such as affordable housing and seniors' centres, and green projects like clean energy infrastructure. 

Martin said the path to balanced budgets and, eventually, to surpluses, is through investing in infrastructure.

"It was our experience when we did it that once you get the economy moving through infrastructure … there's a real return on that investment," he said.

"Investment is not really a huge cause of deficit. It is, in fact, an answer to deficit."

But Martin pointed out circumstances have changed since his time as finance minister. 

"In the '90s, when we had a deficit coming out of our eyeballs and we were the pariah of the rest of the world, it was the issue and we acted," he said.

"I think today is the exact opposite — it's how do you get economic growth? And Justin Trudeau is acting."

Both the Conservatives and the NDP have criticized the Liberal decision not to immediately balance the budget, with Conservative leader Stephen Harper accusing Trudeau of "changing his tune" and Mulcair arguing that the NDP offers a more balanced approach than its adversaries.

Martin dismissed both parties as unprepared to act on what he called the number one issue in the election, saying that Trudeau's infrastructure announcement has "essentially changed the election campaign" discourse.

"What Justin Trudeau's point is, [his projected $10 billion deficit per year] is going to be so small that it's not a factor in this debate," he said. "The factor in the debate is, our economy isn't performing and government can't simply sit by and watch that continue."

Austerity not the response to China, Greece instability

While the Conservatives underscore the need to stay the course in the midst of a fragile world economy, Martin said choosing austerity over growth is short-sighted.

 'If the NDP has decided to move to the far right, so be it — that's their decision.'— Former PM Paul Martin

"We're always going to have a volatile global economy and we're always going to be dependent, because we're a small country, on that economy," he said.

"But if we don't act, if we don't invest in research and development and infrastructure, then we're going to continue with the Tory record of simply another series of long-term deficits, and that makes absolutely no sense."


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