Melody Maker, in their August 21, 1993 interview with Kurt Cobain, explained:

The lyric for “Dumb” seems peculiarly direct, a song about life’s simple, silly little pleasures. Like “I think I’m dumb/Or maybe just happy.” Is it intended to reflect that new-found optimism you’ve mentioned, or should we be reading it ironically?

Cobain: “That’s just about people who’re easily amused, people who not only aren’t capable of progressing their intelligence but are totally happy watching 10 hours of television and really enjoy it. I’ve met a lot of dumb people. They have a shitty job, they may be totally lonely, they don’t have a girlfriend, they don’t have much of a social life, and yet, for some reason, they’re happy.”