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This recent question, What is the literary device/technique called where something familiar is presented so it seems foreign?, reminded me of the opposite situation, where an unusual or scary event happens, but all the characters act as if it is normal.

A classic example occurs in Stephen Leacock's Sunshine Sketches of a Little Town, published in 1912, where almost the whole town is taking a 20 mile steamship excursion to an island for a picnic and festivities to celebrate Dominion Day. Everyone is excited about the trip, when suddenly, half-way across the lake:

I think that it was just as they were singing like this: "O—Can-a-da," that word went round that the boat was sinking.

If you have ever been in any sudden emergency on the water, you will understand the strange psychology of it,—the way in which what is happening seems to become known all in a moment without a word being said. The news is transmitted from one to the other by some mysterious process.

At any rate, on the Mariposa Belle first one and then the other heard that the steamer was sinking. As far as I could ever learn the first of it was that George Duff, the bank manager, came very quietly to Dr. Gallagher and asked him if he thought that the boat was sinking. The doctor said no, that he had thought so earlier in the day but that he didn't now think that she was.

After that Duff, according to his own account, had said to Macartney, the lawyer, that the boat was sinking, and Macartney said that he doubted it very much.

Then somebody came to Judge Pepperleigh and woke him up and said that there was six inches of water in the steamer and that she was sinking. And Pepperleigh said it was perfect scandal and passed the news on to his wife and she said that they had no business to allow it and that if the steamer sank that was the last excursion she'd go on.

So the news went all round the boat and everywhere the people gathered in groups and talked about it in the angry and excited way that people have when a steamer is sinking on one of the lakes like Lake Wissanotti.

Dean Drone, of course, and some others were quieter about it, and said that one must make allowances and that naturally there were two sides to everything. But most of them wouldn't listen to reason at all. I think, perhaps, that some of them were frightened. You see the last time but one that the steamer had sunk, there had been a man drowned and it made them nervous.

Sunshine Sketches of a Little Town, by Stephen Leacock (complete text)

This is the exact opposite of "defamiliarization", making the ordinary feel less familiar. The author tells us that the passengers talk "about it in the angry and excited way that people have when a steamer is sinking", as if that is how people normally deal with their impending doom. It takes what the reader would consider an unusual and dangerous situation and make it feel normal and almost inconsequential.

Is there a technical name for this literary device?

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I believe that this is the distancing/alienation effect.

The abstract to this paper words it well, although the paper itself is behind a paywall:

The theory of "alienation effect" was put forward by Bertolt Brecht. "Alienation effect" means that the familiar contents are presented in an unfamiliar way to get a new effect so that the audience does not empathize with the story of a drama, and can think profoundly about the drama. From the drama to the cinema, the theory of "alienation effect" is also suitable for interpreting the text.

In the case of Sunshine Sketches of a Little Town, we see that the familiar (and terrifying) idea of a ship sinking is presented as petty drama and the topic of gossip - a very unfamiliar reaction! We as readers are taken aback, and can look at the people on the boat in a different way. That work is full of (and poking fun at) the details of the social structure details of a small town. This humorous commentary is well achieved by the distancing effect.

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