Declaring that particular people or ideas are mad, crazy, or insane is a defense mechanism, a way to draw the line in the sand and declare "no further!". That line is your sanity, and its sense is retained by the existence of that which lies outside of it, that which is insane. There are a lot of uncomfortable thoughts out there, and not straying beyond one's own line is a way to ensure that these thoughts are never thought; you follow the madman until they stray cross the line, and you cut it there, labeling them mad so that you are excused from trailing after them into the void.
Society at large engages in this sort of defensiveness. At any given time, there are the taboo topics that cannot be discussed, that lay beyond the collective line. This does not mean that no truth can be found on the other side, only that society has collectively decided to not think about it, to deny it in order to preserve its own sense of sanity.
The man stands on a street corner, carrying a sign that reads: DOOM. He preaches of the apocalypse, the end of times, and the crowd moves past him, blissfully believing that if they don't address the problem, it's not a real problem. The man is mad.
The woman discusses free will. She says that it's an illusion, that you don't have any, that you were damned and doomed and destined from the moment of your birth [1], and that there's nothing you can do about it. You don't listen to her, whether by your own choice or not. The woman is mad.
The child has quite an imagination. They're talking about playing "games" with daddy, and they've learned some lewd gestures from the other children at the playground. You've read stories about creeps sure, but your husband is no creep. The child is mad.
The generals have disposed of the government, torn its rotten roots from the earth and cast its corrupt and effete officials down. They were democratically elected, the magistrates of order and justice. The generals are mad.
[1]This is called predestination, and is one of the cornerstones of Calvinist doctrine.
Most of the time, the defense against madness is a defense against that which lies without, that which sits on edge of the shadows and threatens to encroach in. The defense serves the purpose of keeping it out of the light, of maintaining the order of sanity.
Sometime however, the order of sanity has already fallen. In these cases, the defense against madness is a defense against being brought into the light, of having to wake up and deal with the reality that the world no longer lies within the lines of sanity.
When the Khmer Rouge entered Phnom Penh, and ordered the population back to their ancestral villages, the populace looked at one another, and asked "is this really happening?" It was madness.
When the French aristocracy heard of rebellion in the countryside, they tittered about it in their ballrooms. An advisor to Marie Antoinette, upon hearing that the peasants said there was no bread to be eaten, famously espoused "let them eat brioche!" It was madness.