The kids use Scooter's computer to find the perfect friend for each of them. These include Charlie Chaplin for Fozzie, Arnold Schwarzenegger for Skeeter and a giant monster for Animal, but none of them works out.
The other babies become jealous when Scooter gets a brand new remote control robot; but they use their imaginations and some of Nanny's old toys to have some fun of their own.
The kids try out various forms of government to decide who gets to make the rules for their games. They first try monarchy with Piggy as their self-proclaimed queen, then anarchy and finally democracy with Kermit running for president.
Nanny is taking a vacation, so the kids imagine Piggy, King Kong and Darth Vader as her possible replacements. Horrified by these choices, the kids ask Nanny to go on their imagined trip around the nursery in 80 days instead.
The kids get to play with Nanny's new pet, Polly the talking parrot. However, the way Polly repeats everything it hears causes confusion and anger as the kids mistake the things it says for something that their friends have said.