How to deal with people who live in alternate realities, who seem like they could be in a psych ward, but instead are participating members of society?

I often wonder, is the human condition getting worse? Or do we pass through life as in a fog, continually rediscovering scenes of the insanity play as they emerge, thinking that they are new phenomenon only because we have largely forgotten the previous scenes?
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“You never change things by fighting the existing reality.
To change something, build a new model that makes the old model obsolete.”
– R. Buckminster Fuller