There are ostensible (if legal) reasons for this and then there are the unofficial (but real/actual) reasons.
1. Ostensibly/legally, insulting someone in Germany is a breach of their human dignity under the terms of Article 1 of the German Constitution ("Human dignity is inviolable."). Insulting someone in this country is by definition a violation of their human dignity which means that you can be sued and as often as not, will be. The fact that such an insult is also a breach of the Constitution automatically makes it illegal.
2. Unofficially/actually, you have pissed someone off so badly that they usually want to "get you back" for it - in other words, they want "revenge". And since physical violence in this country is a big no-no (remember that the use of force is reserved by law to the state here), the only avenue of recourse for the citizen is the courts. Since German judges take the Constitution very seriously, it has become legal "lore" here that insults such as "Arschloch" etc. etc. are by definition violations of human dignity. And so once you're in court for insulting someone in this manner, you can't win and the claimant can't lose. This leads to another reason: it can be reasonably lucrative to win such a case: 4-figure+ euro amounts plus legal and court costs paid. It would also be idle to deny that the existence and availability of legal insurance make it that much easier for the citizen to sue for this and other insignificant matters. Which is one of the reasons why you need legal insurance in Germany.
I happen to agree with you that people should not be such milquetoasts that the use of "Arschloch" etc. should, in law, be an insult and a reason for suing someone. But that's the way it is here. To my mind, people should sort out matters like this out round the back of the building without having to call on the law for a matter that does nothing but jam up the German court system, cost taxpayers' money and which really has no business before the courts in the first place.
The issue with insulting the German police is that, as "Beamte", they are very prone to making use of Article I of the Constitution (indeed, most "Beamte" are, whether police or not). It can also get even more expensive: 5-digit euro amounts plus all legal and court costs.
Where I come from (New Zealand), it is actually a criminal offence to insult police officers and prison officers (i.e. it is solely a legal matter: we don't have a formal Constitution). However, this has less to do with human dignity and more to do with the fact that the police and prison officers do a difficult job that very few other people can or would want to do.
I'm neither married nor do I have any kids but after reading Billabong's posts, it seems to me that you might want to take some time to get used to Germany and living with your BF before thinking about having kids - if you have any plans in that direction in the first place. Remember: you can't give 'em back.
Even a warning couched as information (frankly I think it was a warning but let's not go into that here) is problematic without having first ascertained the facts behind the original allegation (essentially hearsay).
Then again, if I think about it, it's probably administratively easier (read lazier) to send out an offical letter of warning - true or otherwise - than to send out some minor town hall official to find out what the real story was (now that would involve real work!).
I see a far more disturbing issue at stake here, namely the fact that the city authorities were prepared to write a warning letter on the basis of what seems to be an unsubstantiated complaint.
In a country that prides itself on being based on the rule of law, an official warning appears to have been issued without the matter being investigated first. The city authorities should have visited boondoggle's residence and asked if there was any truth to the allegation before firing off this official letter.
I agree that there is probably some minor discrimination being practised here. I would write the letter - including the point about discrimination - and see what happens.
And, yes, do get legal insurance.
Should things go pear-shaped, is moving away an option?
1. Techniker didn't want to know about my mother when I joined it.
2. Different subject, same organisation: for purely financial reasons I am switching from the Techniker to (probably) the Barmer GEK (TK wants an extra €100 a month). However, TK is taking its sweet time about acknowledging my resignation.
3. Not quite related: I am switching from one legal insurer to another. However, my current insurer is also taking its sweet time about acknowledging.
Anybody got any ideas on how can I chase both these roosters up, please?