Father of capitalism Adam Smith 'would back New Labour' - Brown

GORDON Brown is to claim that the father of modern economics and free market capitalism, Adam Smith, was spiritually an early member of New Labour, in a book published later this year.

The Chancellor had challenged Iain McLean, a professor of politics at Oxford University, to write a book on where one of the world's most famous Scots would feel "more at home" if he was alive today: on the centre-left or centre-right of politics.

And, in a foreword to Adam Smith, Radical and Egalitarian, published by Edinburgh University Press, Mr Brown makes it clear he believes the economist had a strong social conscience that would make him a political ally. The Chancellor has long attempted to claim the giant of the Scottish Enlightenment for Labour.

Mr Brown may also be seeking to bask in Smith's reflected glory: the Chancellor has lately been assiduous in attempting to build up his own credentials as an intellectual and a statesman, this year publishing two books of his own speeches with forewords by the likes of Nelson Mandela and Alan Greenspan, the former chairman of the US Federal Reserve.

However Michael Forsyth, a former Conservative Scottish Secretary who is currently trying to raise money for a statue of Smith, said Mr Brown's attempt to snatch Smith's legacy from the hands of the Tories simply showed that Thatcherism had finally won the argument with the old Left.

Smith's book Wealth of Nations is seen as the foundation-stone of modern economics, spelling out the benefits of a free market of people acting in a basically selfish way, but he also wrote a book called The Theory of Moral Sentiments which praised altruism.

Mr Brown writes in the foreword that since his death Smith "has had the reputation of an apologist for 'laissez-faire' at its most heartless".

But he says: "Coming from Kirkcaldy, as Adam Smith did, I have come to understand that his Wealth of Nations was underpinned by his Theory of Moral Sentiments.

"Indeed, he wrote a new chapter in 1790 for the new edition of Theory of Moral Sentiments entitled 'On the Corruption of our Moral Sentiments' which, according to Smith, is occasioned by 'the disposition to admire the rich and great and to despise or neglect persons of poor and mean condition'."

The Chancellor challenges the idea that Smith's two books contradict each other. He points to two quotes from Smith that suggest he was never a fan of "greed is good" economics: "All for ourselves and nothing for other people [is] a vile maxim" and "Whenever we feel the fate of others is our personal responsibility, we are less likely to stand idly by."

Mr Brown writes: "Adam Smith always believed that the town centre was far more than a marketplace.

"And when he stood under the banner of freedom, he did not argue for a freedom that gave men immunity from a responsibility to serve their society."

In the book, Prof McLean admits Smith is capable of being interpreted as belonging to the Left. "There are some parts of Smith's arguments to which the modern Right can legitimately lay claim. But, taking Smith's work as a whole, I think he can only be classed as an egalitarian and left-wing philosopher."

Lord Forsyth said he welcomed Mr Brown's support of Smith's ideas:

"The fact the Left are now embracing Adam Smith is just another step along the way towards the complete victory of Thatcherism."

Burns 'an admirer' of great free marketeer

DESPITE being written more than 200 years ago, Adam Smith's The Wealth of Nations remains a seminal text for any study of economics.

Writing at a time when trade was controlled by local cartels, Smith claimed a truly free market was guided by an "invisible hand" that would increase prosperity and reduce poverty.

He was the first to suggest prices were controlled by the forces of supply and demand, arguing that, if a product was in short supply, its price would rise, prompting more people to start making it.

Last year, Alan Greenspan, then chairman of the US Federal Reserve, gave the Adam Smith Memorial Lecture in Kirkcaldy, praising the economist as "a towering contributor to the development of the modern world".

In his book, Iain McLean also makes the case that Smith, who was born in 1723 and died in 1790, and the poet Robert Burns, below, - a hero to many on the left - were mutual admirers.

"Smith and Burns were kindred spirits ... Burns has transmitted Smith's thought to millions of people who may not have realised that it was Smith's," he claims.