Much Madness is divinest Sense— To a discerning Eye— Much Sense—the starkest Madnes— (1-3)
Let's zero in for a sec on the fact that the speaker uses the adjective "Much" twice in these first three lines. We get the basic paradox: crazy people are sensible, and sensible people are crazy. But why does the speaker specifically say that we're dealing with a whole lot of crazy and a whole lot of sensibleness. Could the speaker be saying that only extreme madness is "divinest Sense" and only radical sensibleness is "starkest Madness"?
'Tis the Majority In this, as all, prevail— (4-5)
Here it is: Majority with a capital M. This is the part where the speaker takes the poem to a whole new level. We're not just talking around circles about individuals who might be sane or insane; we're talking about the fact that the Majority of people are part of a massive conspiracy of craziness. Is this true, or is the speaker exaggerating? Can you think of ways in which mainstream society is completely off its rocker?
Assent—and you are sane— Demur—you're straightway dangerous— And handled with a Chain— (6-8)
These last lines reveal just how arbitrary the idea of sanity is. It's not based on your actual mental state; it's based on whether or not your mental state matches with everybody else's. What if you live in a place where everybody thinks it's totally sane to eat their own toes? Who's the dangerous one then, huh?