What did G. K. Chesterton mean by these two paragraphs from the first chapter of 'The Man Who Knew Too Much'?

Question

'Jenkins,' he repeated. 'Surely you don't mean Jefferson Jenkins, the social reformer? I mean the man who's fighting for the new cottage-estate scheme. It would be as interesting to meet him as any Cabinet Minister in the world, if you'll excuse my saying so.' 'Yes; Hoggs told him it would have to be cottages,' said Fisher. 'He said the breed of cattle had improved too often, and people were beginning to laugh. And, of course, you must hang a peerage on to something; though the poor chap hasn't got it yet. Hullo, here's somebody else.'

What does "the new cottage-estate scheme" mean? a scheme to build cottages for the peerage instead of their regular estate? Does "... people were beginning to laugh" imply that people are getting better living conditions because "the breed of cattle had improved too often"? And what does it mean to hang someone on to something?

All I can make out of it is that peasants are getting richer, which makes the governors uncomfortable and willing to do something about it.

For more context, here is the whole story: http://www.classicreader.com/book/485/1/

Any corrections to my writing are appreciated.

Answer 1

It means that Jenkins has embarked on a social reform agenda to build “cottage estates”, i.e., public housing: a tract of cottages for the poor.

The dialogue suggests that the speakers don’t think he is doing this out of sincerity, but because he hopes to get a Peerage out of it. A Peerage can be awarded for extraordinary achievement in some field. The idea is that Jenkins first thought that he could get his Peerage for animal husbandry, improving cattle by selective breeding. But many people have already done that, to the point where another person attempting to improve cattle would yield diminishing returns, at least as far as the possibility of a Peerage is concerned. Hence Jenkins turned to social reform as a more likely route to getting a Peerage.