The Smearer does exactly what the name says, it "spreads" image contents. The image area under the mouse is picked up and copied to the new position according to the set tool parameters.
With maximum sharpness and intensity the image area can so to speak be "moved"; with sharpness set to 0 you can achieve a real smear. The intensity control sets how far the effect spreads.
Note: As with the Water tool, the Smear tool always assumes the edge of the picture to be white.