Multiple commenters (#19, #43) have posted the workaround.  In my
~/ssh/.config I now have

Host *
# Workaround for the dreaded 'connection reset by peer' bug, openssh >=5.7:
Ciphers aes128-ctr,aes192-ctr,aes256-ctr

and I no longer see this problem.

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https://bugs.launchpad.net/bugs/708493

Title:
  Can't login anymore: Read from socket failed: Connection reset by peer

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