The citizens of Springfield are bombarded with a media blitz hailing the arrival of Gabbo, a ventriliquist's dummy who resembles Howdy Doody and sounds like Jerry Lewis. Ventriloquist Arthur Crandall and Gabbo appear on TV every afternoon opposite Krusty the Clown, and Bart and Lisa fear that the competition will jeopardize Krusty's career. When Krusty's ratings plummet, his show is cancelled.

Krusty's efforts to find employment--and win at the racetrack---also fail. Determined to ruin Gabbo, Bart sneaks into the studio and activates a TV camera just as Gabbo is bad-mouthing his audience. Meanwhile, Bart and Lisa advise Krusty to relaunch his career with a TV special featuring major celebrities.

Bart and Lisa contact Bette Midler, Hugh Hefer, Elizabeth Taylor, and the Red Hot Chili Peppers. All but Taylor agree to appear on Krusty's show. With additional help from Johnny Carson and Luke Perry, the special is an enormous hit, and Krusty's show is reinstated.