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?
“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