It's the war years in Salinas, and everyone is involved.
There is a German man who has lived in Salinas for twenty years named Mr. Fenchel.
He was just another member of the community until the war came along, but then suddenly everyone assumed that he was the enemy. No one says hello to him on the street.
One day little John and Mary Steinbeck wait for Mr. Fenchel to pass their house, and when he stops to greet them they answer "Hoch der Kaiser!" ("Hail the Kaiser," i.e. stuff the German army says). Ouch.
Poor Mr. Fenchel begins to sob—John and Mary feel awful, even years later.
John and Mary may have done a number on Mr. Fenchel, but eventually the town of Salinas does an even bigger number when thirty men goose-step.
War, says the narrator, involves a lot of hysteria, and a lot of heroism too (including those people who chose to object to the war), but above all war is messy, undignified death and a lot of sorrow.
But there were also some people who made some cash.