The Simpson family is all together in the living room, trying to get Maggie to speak. Maggie opens her mouth seemingly about to say her first word, but only burps. While the family is on topic of first words, Bart goes to ask Marge what his first word was. Marge claims she doesn't remember (she lies, it was "Aye Carumba!"), but tells them the story of Lisa's first word is very cute. She begins to tell the story…
Back in spring of 1983, the Simpson family (pre-Lisa and Maggie) lived in an apartment in East Springfield. Homer comes home from work to pick up baby Bart at home, who starts to call him by his first name. Homer is not happy with this and tries to fix it to no avail. As a baby, Bart is quite a handful for his parents. Right after Bart goes to flush Homer's wallet down the toilet, Marge comes up to Homer telling him they will be having another baby. At first, Homer thinks it will be great, but thinks otherwise as he may have another Bart when his son flushes his keys as well. Marge doesn't seem to object to that act and she tells Bart he will be having either a little brother or sister to play with. Bart thinks of the possibilities, thinking it will be cool to have a scapegoat.
But there's a problem. With a new baby on the way, the Simpsons will need a bigger house. Marge declines Homer's idea to have the baby sleep in Bart's crib while Bart sleeps with them until he's 21. So, they leave Bart with Patty and Selma to go house-shopping. Homer and Marge are having trouble finding the right house… and the right neighborhood. Until finally, they came across a house that was perfect… unfortunately, they can't afford it. So, Homer goes to talk to his dad about obtaining a loan for the $15,000 house. Grampa says the only thing he's got is the house, but agrees to sell it for his son. Homer invites his dad to stay at his new house… but was shaved off to the Retirement Center in three weeks.
After Homer loses out to Maggie's deception (cookie for a word), the story continues. They move into their new house, but Bart is not pleased with it. After another "Homer vs. Daddy" argument, Homer is greeted by his new neighbor Ned Flanders and his son Todd. Homer is not thrilled to meet him, setting the tone for years to come. Ned offers his assistance anytime Homer may need it, which Homer takes literally right now asking for his newly-bought TV tray. Ned Flanders agrees to let Homer borrow it for a little while…
…and according to Homer, that little while is eight years and counting. Marge continues to tell the story as Bart just entered the terrible twos. When he starts to drive Marge crazy with a spoon and pot, he is sent away, and Bart goes to Homer to watch TV together. Krusty, in the meantime, is having Krusty Burger sponsor the Olympics: anytime the U.S. wins a Gold Medal in the corresponding ticket's event, the customer wins a free Krusty Burger that will have to come out of his pocket. It turns out to be rigged, as the tickets are for events the Soviets never lose. Unfortunately for Krusty, there is currently a Soviet boycott and America stands unopposed in most events… and according to his accountant, Krusty stands to lose $44 million.
To pull Bart away from his crib that the new baby will be sleeping in, Homer builds Bart a bed—which takes the form of a very eerie-looking clown. As the family watches the Olympics (with Homer eagerly anticipating another free Krusty Burger), Marge's water broke; the baby is due. Homer and Marge leave Bart with the Flanders family, where Bart is not enjoying himself. He wants to go home… but changes his mind remembering his new clown bed.
The Simpsons' newest child is a girl that they named Lisa. Homer calls Bart in to meet his baby sister… and Bart is not happy with her.
With Lisa as the newest addition to the family, she is soon soaking up any and all attention from Homer, Marge, Patty and Selma, leaving Bart with nothing. As the U.S. continues to dominate the Olympics with Krusty crying all the way to the bank, Bart starts to do whatever he must to gain attention from his parents. For anything he does with Lisa, Bart is punished by sitting in the corner.
Finally, Bart is completely fed up with Lisa, and plans to run away from home. He swears Lisa off, saying he liked his life better when it was just him, Mom and Homer. As he starts to walk away, Lisa says her first word: "Bart". Enthusiastic, Bart goes to show Homer and Marge. Lisa is also able to say "Mommy" and to a lesser extent, "David Hasselhoff". But when Homer wants her to say "Daddy", like her brother before, Lisa calls him "Homer". Homer is angry thinking he's screwed up another child.
In the present, while Bart, Lisa and Marge fight over Bart's name (literally) carved into the carpet, Homer puts Maggie to bed, telling her he is happy with her never talking, as he figures the sooner kids start talking, the sooner they talk back. He turns off the light and leaves. At this time, Maggie pulls out her pacifier to say her first word: "Daddy".