Note the general laughter that follows the remark. Now,
if Chesterton had been alive today and said that sort of thing he could
have had his publishing contract dropped and the rest of his lecture
tour cancelled. He might have been banned from entering (or re-entering)
the UK. Or, since the speech was uploaded to YouTube, it's possible he
would have been charged with a hate crime violation.
Chesterton was being made an honorary member of
the Holy Cross Crusaders, after all. By the
way, I too first thought he was holding a microphone. But in fact it's a
walking stick, or rather, one of two walking sticks. Enjoy!