As pointed out in a recent comment, the mid 1960s was a time of huge UFO 'activity' in the world. There was a real media buzz regarding huge waves of UFO sightings. I remember at the time a feeling of excitement that maybe we truly weren't alone.
A large percentage of 'true' sightings (as opposed to hoaxes) were proven to be natural phenomena (or pitched hats). But there were the tantalizing cases where even the experts were baffled, and oh, that was the good stuff that kept the buzz alive.
At the time of this strip, 1966—1968, the Condon Committee (University of Colorado UFO Project, under direction of physicist Edward Condon) was in the midst of investigating and examining many hundreds of UFO files and sightings.
Just as Deacon is verbalizing in this strip, people might describe in great detail all the features of a 'space craft', only to have it proven that it was an ordinary object seen under extraordinary circumstances. Sometimes people saw what their imaginations wanted them to see.
Kelly's storyline here seems to be blending that phenomenon with the one of political mistrust—both of which are still going on, all these years later.