In his foreboding 1921 poem "The Second Coming," Yeats theorizes that a gentler era of history, ushered in by the birth of Jesus, is coming to an end. Instead of the second coming of Christ, however, which Christians traditionally see as the "end" of history, Yeats envisions a "rough beast" being born in Jesus's birthplace of Bethlehem. This birth will start a new, more violent spiral of history.
The lines referred to, which end in the "ceremony of innocence," are as follows:
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned.
The anarchy and blood-dimmed tide Yeats describes allude to the Russian revolution and World War I, both shocking and violent events in the European consciousness. A bloody tide seems to be rushing in everywhere. Because there is so much blood, innocence itself appears to have been drowned in it. People can no longer live in innocence, because too much death and violence has occurred.
Yeats uses the term "ceremony of innocence" to harken back to the ordered, structured, ceremonial world of pre-war Europe. Yeats mourns what he sees as the loss of an aristocratic order. Instead of order, the world is now awash in bloody chaos or anarchy.