‘Given [Samuelson's] centrality to economics post-1939, for over 70 years he was the embodiment of modern history of economics.’

He certainly was, but he was not right on Adam Smith.   Almost single-handedly, Samuelson was the main source for the modern mythology of Adam Smith’s meaning when he used the metaphor, ‘an invisible hand’ (to do with perfect competition, welfare theorems and general equilibrium) [See: Kennedy, G. 2010. ‘Paul Samuelson and the Invention of the Modern Economics of the Invisible Hand’. History of Economic Ideas, xviii/2010/3] .

Samuelson wrote:

“Even Adam Smith, the canny Scot whose monumental book “Wealth of Nations (1776), represents the beginning of modern economics or political economy – even he was so thrilled by the recognition of order in the economic system that he proclaimed the mystical principle of the “invisible hand”: that each individual in pursuing only his own selfish good was led, as if by an invisible hand, to achieve the best good of all, so that any interference with free competition by government was almost certain to be injurious.  This unguarded conclusion has done almost as much good as harm in the past century and a half, especially since too often it is all that some of our leading citizens remember 30 years later, of their college course in economics.  Actually much of the praise of perfect competition is beside the mark. As has been discussed earlier, ours is a mixed system of government and private enterprise; as will be discussed layer, it is also a mixed system of monopoly and competition.  It is neither black nor white, but gray and polka-dotted.” (Samuelson 1948, Economics: an introductory analysis, p.36). 

This careless and erroneous statement was an origin of the myth that also did more ‘harm’ than ‘good’ after 1948 and in various modifications in the following 18 editions of his ‘Economics’ text, which for many of us was our introduction to economics as undergraduates, (paraphrasing) ‘especially since too often it is all that some of our leading citizens [economists included] remember 50 years later, of their college course in economics.’ 

The phrase is now ubiquitous, used in equal measure both to praise market economies (which, necessarily, work so well through very visible prices without ‘mystery’ or ‘miracles’, as Smith argued without mention of ‘an invisible hand, in Books I and II of Wealth of Nations, and to discredit Adam Smith from the left (market and government failures in the mixed economy).  It is also the source of considerable rubbish in the popular media, and some avoidable confusion in adjacent disciplines.

Our justified admiration for Paul Samuelson should not prevent us from frank discourse of where he was in error when writing as an historian of the economic thought of Adam Smith.
Gavin Kennedy