What would Adam Smith  say about humanity’s reaction to Covid-19? Of course, no one can really know. But there’s good reason to think that Smith would worry about the Covid-inspired social separation.
In his 2020 book, Adam Smith , the University of Glasgow’s Craig Smith unpacks and explains to his readers Adam Smith’s philosophy. On pages 50 through 52 – in a chapter on The Theory of Moral Sentiments  – Craig Smith writes (emphasis added):
[Adam Smith] is aware that we are able to generate more perfect sympathy [i.e., empathy] with those who are close to us, and it is in the presence and approbation of friends and family that we are able to indulge our strongest feelings and expect the greatest understanding. But we are also subject to the judgement of more distant spectators who are not partial enough to indulge our strongest feelings, and who cannot enter into our passionate experience as fully as those who are familiar with us. Such figures may enter into our experience of serious misfortunes, like the death of a loved one, but they are less willing to indulge our disappointment at matters of smaller account. This fact about humans leads Smith to observe that society and conversation have a therapeutic effect. Moreover, the society of strangers with their weaker degree of sympathy [again, empathy], and our subsequent desire to flatten our emotions, suggests that mental tranquility can be restored by associating with those who are less willing to indulge our feelings….
[Adam Smith is led] to the idea that the desire to secure the approval of strangers helps us to compose ourselves. It is company, particularly the company of strangers, that calms our minds. Our friends and family indulge and condole us, but strangers force us to master our feelings….
Society is the “great school of self-command.”
DBx: That is: By being among strangers, each of us controls our emotions in ways that we do not when we are among only family and close friends. You might, for example, express dramatic disappointment and sadness to your spouse or to your brother over the fact that your favorite football team lost today’s game. But you don’t do such a thing to strangers you encounter at the supermarket or at a restaurant; it’s simply inappropriate.
Your family and close friends allow you to indulge, with them, a wider range of your emotions than you feel appropriate inflicting on strangers.
Being among strangers, therefore, prompts each of us to keep our emotions more in check than when we are in the exclusive company of family and close friends. And this habit of keeping our emotions more in check when we are out and about in society promotes our “mental tranquility.”
In short, I would not be surprised that, were Smith still alive, he would observe that being among strangers, because it prompts us to control our emotions, plays an important role in keeping us sane. And, thus, one significant cost – danger, even – of the Covid-inspired greater isolation of human beings is indeed an increase in genuine mental problems.
Note that I am not arguing, or even suggesting, that Adam Smith would disapprove of this isolation or of any of the policies and reactions to Covid that led to it. Such a thing is unknowable, for Smith might well estimate that the benefits to physical health of this isolation are greater than its costs. But I am saying that Adam Smith would indeed understand that one of the significant downsides of the Covid-inspired isolation is increased mental anguish. He would surely counsel us to take into serious consideration the deleterious emotional and mental consequences of separation from the larger society.