Well 50 years on we still haven't seen any of these "sufficiently smart compilers", at best they can outsmart C compilers in a few cases with things like generics, so the idea that higher level languages would be faster has been wrong for at least 5 decades. At least you can forgive them for thinking they would 50 years ago, but now it's just ignoring 50 years of reality.
In the real world we've pissed away 30 years of hardware improvements primarily through switching to higher level languages. In the real world higher level languages are still not used we're performance counts (like games). In the real world low level languages like c and C++ are still powering our most important and fundamental projects.
Source, replacing GUI and distributed applications written in C and C++ with managed languages (AOT and JIT) for the last 20 years.
I also happen to remember languages like Fortran and Ada do exist.
Proper abstractions define exactly what happens in every situation, and design unobservable details out. It is the basis for optimizations that fundamentally cannot observed (except side-channels, like timing and other resource usage). Proper abstractions is why we have fast processors. The ISA is a hard boundary.
2006: "..but something else had happened--and that was back in 1973--[something] which I was very, very unhappy about--and that was the advent of C! It derailed, as far as I was concerned, the advances that I foresaw in compilers. One cannot let the user play with the addresses, and use procedures, and play with pointers--which is pointing to the data--and be able to understand how one can transform the program to run more optimally."
"There was an interesting debate at the SIGPLAN conference in that period--about the relative need for optimization. It was put on the table that it wasn't going to be needed anymore! So. Anyway. You can have your own opinion on that, but I know I have mine, beyond a doubt that it was a huge setback for--in my opinion--languages and compilers--and the ability to deliver performance--easily--to the user."
https://en.m.wikipedia.org/wiki/Frances_Allen
https://www.youtube.com/watch?v=NjoU-MjCws4&t=2450