Aunt Alexandra is upset that Jem knows the truth about Cousin Joshua, because she is trying to instill in him pride for his family.
Aunt Alexandra tries to instill a sense of importance in Jem and Scout. She is using Cousin Joshua as an example of that.
It was a sad thing that my father had neglected to tell me about the Finch Family, or to install any pride into his children. …She left the room and returned with a purple-covered book on which Meditations of Joshua S. St. Clair was stamped in gold. (ch 13)
Jem asks her if this was the same cousin Joshua that was locked up for so long after going “round the bend” and tried to shoot the president. Alexandra becomes “stiff as a stork” as a result. She convinces Atticus to tell them about their “gentle breeding,” and explains that they are Finches and therefore superior. Atticus tries, but then Scout starts crying because he is not acting like her father, and he tells her to forget everything she said.
The comments about “gentle breeding” are certainly not typical of Atticus. He thinks that as long as someone is a good person, then he or she is worthy of praise. How long you have squatted on a piece of land does not matter. He has raised Scout and Jem this way, and despite Alexandra’s interference, will continue to do so.