Banks plays a joke on the idea of "flag etiquette." Normally etiquette is about how people treat a flag: how to fold it, raise it, or display it. Here the poem flips this around and accuses the flags themselves of bad manners. They push to the front, shove other flags out of the way, and fight for the highest spot on the pole and the best place on the podium.
The speaker sounds dry and mock-serious, like someone delivering a scolding with a straight face. The short, clipped lines ("Indeed," on its own) add to that deadpan tone. The last lines turn sharper. The flags make their caretakers feel ashamed if they get dirty by anything "short of national policy or diplomatic duplicity." That phrase suggests a quiet jab: it is fine for a flag to be stained by political scheming, but not by ordinary dirt. The mood is wry and a little cynical, poking fun at how seriously nations treat their symbols.