What was once Washington, D.C. has lost most of its infrastructure, with people living in plastic huts called "domistiles". The human population has become morbidly stupid, speaking only low registers of English competently, and is profoundly anti-intellectual with individuals being named after corporate products. Suspecting hallucination, Joe enters a hospital, where he is incompetently diagnosed and comes to realize what has happened to him and society. He is arrested for not having a bar code tattoo to for his doctor's appointment, and is sent to prison after being assigned the grossly incompetent Frito as his lawyer. Meanwhile, Rita escapes from her chamber and aims to resume working as a prostitute, but soon realizes that people have become so stupid that she can charge customers money without doing anything for them.

Joe is renamed "Not Sure" by a faulty speech-recognition tattooing machine. He takes an IQ test and then tricks a guard by telling him that he was in the wrong line, and should be getting out of prison instead of coming in. He escapes by simply walking out the door while the guard is checking his prisoner exit records. Once free, Joe finds Frito and asks him whether a time machine exists to return him to 2005, bribing Frito with promises of riches through compound interest on a bank account Joe will open in the 21st century. While leading Joe and Rita to the time machine, Frito takes them into a gigantic Costco store, where a tattoo scanner identifies Joe. He is apprehended but is surprised when he is taken to the White House, where he is appointed Secretary of the Interior on the grounds that his IQ test identified him as the most intelligent person alive.

President Camacho gives Joe the impossible job of fixing the nationwide food shortages, Dust Bowls, and crippled economy within a week. Joe discovers that the nation's crops are irrigated with a sports drink called Brawndo, whose parent corporation purchased the FDA, FCC, and USDA. When Joe has the drink replaced with water, Brawndo's stock drops to zero and half of the population lose their jobs, causing mass riots. Joe is sentenced to die in a monster truck demolition derby featuring the undefeated "rehabilitation officer" Beef Supreme. However, Beef's derby vehicle is too large to enter the arena and is crushed under the collapsing pillars and ceiling.

Frito and Rita discover that Joe's reintroduction of water to the soil has prompted vegetation to grow in the fields. During the televised event, they arrange for the sprouting crops to be shown on the stadium's display screen, and Camacho gives Joe a presidential pardon. Joe and Rita decide to stay in the future, though they soon discover they had no choice as the "time masheen" Frito mentioned is merely an extremely inaccurate history-themed amusement ride. Following Camacho's term as president, Joe is elected. He marries Rita and they conceive the world's three smartest , while new Vice President Frito takes eight wives and fathers 32 of the world's stupidest . In a post-credits scene, Upgrayedd awakens from his own suspension chamber and sets off in search of Rita, just as she had predicted earlier.