Meaning: A symbol of being a jerk or scumbag. People usually use this meme to express what someone they know did without having to add how contemptible they find it (which is already implied by the picture). The first line is usually about something quite ordinary while the second line explains how he’s managed to turn it into something despicable.
The hat itself has become a symbol of “scumbagness” and can be put on virtually anything, but the meaning in this case is often just “trolling” rather than doing something despicable. Two notable uses that have become widespread are “Scumbag DNA” (on the left in the picture below) and “Scumbag Brain” (on the right).
Scumbag Brain is now usually displayed without the hat, just in a form of a brain (see below). The original brain (above) was posted by a Reddit user “Jackist” in 2012 to a subreddit that tries to support people with suicidal thoughts.
Origin: The real name of the man in the photo is Blake Boston. The photo was taken by his mother around 2006 (when he was about 16), and subsequently used as the cover image of the album “Ma Gangsta” of an amateur rapper group “Beantown Mafia” (in which Blake participated). The first recorded occurrence as a meme is in 2011 when an unknown user posted a compilation of “Scumbag Steve” memes to Reddit. The name Steve is just a placeholder and is not related to the man in the photo.