IPhone 5 contacts local sync via usb doesn't work - updated

Question

Syncing an iPhone 5, AT&T 64GB, with Macbook Air 11" mid-2011, 1.8GHz / 4GB.
OS X 10.10.2; iTunes 12.1.0.50; iOS 8.1.3.
I am trying to sync my contacts from my OS X Contacts App to my iPhone 5 via USB. The contacts do not sync. The contacts are local, "on my mac". I am using a usb cable through iTunes.
The iPhone 5 was just restored by Apple Configurator, set up as new iPhone, and is supervised by the MacBook Air.
I am also synchronizing my local Calendars from the OS X Calendar app; these transfer just fine. This makes me think it is probably not to do with the entire setup of the iPhone, i.e. that it is managed by apple configurator, since some of the sync works correctly.
Under "info" in the iTunes sync dialog, I have selected the "sync contacts" and "all contacts" and "sync calendars" and "all calendars" options.
Interestingly, while the Calendars sync options displays options of "selected calendars" and a list of my calendars available to sync, the Contacts section "selected groups" is grayed out. I have one group in Contacts, and it does not show up by name for "selected groups". Instead, the area where groups should be listed for selection is empty. Perhaps iTunes does not have access to my local contacts? It is not listed under apps with access to my contacts under security and privacy, and it has not requested access to my contacts.
I created a fake contact on the phone and synced it with iTunes. I then turned off contact syncing in iTunes and told it to remove previously synced contacts. The fake contact disappeared. When I turned contact syncing on again, the contact was again pushed to the phone. However, the fake contact did not appear at any point in the OS X Contacts App, and none of my OS X Contacts appeared on my phone -- only the fake contact I had created on my phone and then synced with iTunes.
I also created a (different) fake contact in OS X Contacts. iTunes sync did not transfer this contact (or any others) from OS X Contacts to iPhone.
SUMMARY:
- syncing iPhone 5 via USB with iTunes
- Calendar sync works
- Contacts sync doesn't work
- iTunes appears to have no communication with the OS X Contacts app; in system prefs > security and privacy > privacy > contacts, Pages and Word have access to Contacts, but iTunes is not listed. iTunes Contacts sync "selected groups" does not display my OS X Contacts group names.
- Contacts created on iPhone sync back to iTunes and are restored back to the iPhone if deleted and resynced.
- Contacts created on iPhone do not sync back to OS X Contacts; Contacts in OS X Contacts do not sync to iPhone.
(apologies for premature posting to "Using iPhone"; I accidentally submitted and now can't delete or edit).

Answer 1

Here's the resolution: I went to my local Apple store and spoke to the guy. After some discussion it turned out that one of the staff had had a similar problem. He suggested this course and I can report that it seems to work. So, (1) open your system preferences and then the print & fax setting and delete the printer in question (2) disconnect the USB between the printer and the TimeCapsule (3) shut everything down and turn off power to your modem, your TimeCapsule and your whole system (4) power on each item in its normal sequence (5) wait for your iMac to complete its boot-up, (6) re-connect the USB between the printer and the TimeCapsule (7) open system preferences and search for and install the relevant printer (8) try printing.
This is hardly elegant, but it worked. I am told (by the same Apple store) that hitting the "reset" button in the TimeCapsule might also work. If this is intuitive or obvious to anyone else then my compliments to them ...
Cheers
OzHutz