He's going to be a Character...whatever the hell that means!

Vonnegut is trying to make the point that people are discouraged to be something other than plain and boring. They are encouraged to be just like everyone else. Earlier in the passage, Campbell is trying to convince the American men to go with his group and fight the Communists. People were being cowards when they did not stand up for what they believed in and let Campbell just walk all over them.
The line stated, “People are discouraged from being characters.” This means that people were discouraged to be their own person and stand up for their beliefs, whatever their beliefs may be. They are also discouraged to be their “own person”. When you think of a character, you normally think that you will remember them for something special that they did, whether it be very bad or heroic. In this case, Derby was a character hero in the sense that he stood up for his beliefs and did not let Campbell walk all over the entire group in the slaughterhouse. He did not let Campbell talk to the group of American soldiers like they are animals.
When people are discouraged to be characters, they are told to be boring, bland, and like everyone else. People are discouraged from being characters because they authority is scared of what actions those not in authority will take. The authority puts such a threat on the people to not be characters the people listen and the authorities do not have to do anything.
As Derby did take action and did speak up for the group in the slaughterhouse, he was a character and was something other than just another bystander. He told Campbell what he thought because he was fed up with the crap that they all were being put through. By him standing up, he is a character.