All Quiet on the Western Front tells the story of a group of young soldiers fighting for Germany in the First World War. Encouraged by their teachers to do their part for their country, many of them have gone straight from school into the army, and have never experienced normal life.
World War I was horrific. Soldiers spent days at a time in cramped, dirty, rat-infested trenches, and there was always the chance that they would be bombed, gassed, or shot by the enemy. Furthermore, few soldiers understood why they were fighting in the first place.
When Kropp says "the war has ruined us for everything," he is talking about the psychological effects of such brutality. At the time, this effect was called "shell-shock," but now we know it as post-traumatic stress disorder. Those who suffer PTSD feel disconnected from "normal" life because they have been so scarred by past events.
We can see the effect when Paul returns home for a short time. He is unable to interact with his family, and he only feels rage and disconnection when he encounters old acquaintances. He is anxious to get back to the front, even if it means he will die.