Trying to understand pull-up resistors

Here's a perfect example of something about this that keeps confusing me.

I'm working on the understanding that to have current flow, you need an emitter (-) on one side of a circuit, and a collector (+) on the other.

If when S1 is open current is flowing between Vcc and pin 1, that means that whatever is on the other side of pin 1 is Vee, right? And ground is an emitter, right? So why would connecting Vee (whatever is on the other side of pin 1) to ground by closing S1 have any impact on how current is flowing between Vcc and pin 1? Even if you then have current flowing from Ground to Vcc, wouldn't current still be flowing from the other side of pin 1 to Vcc, too?

I guess the crux what I don't get is what happens on the line to make pin 1 go low (low voltage/small current, yes?) when S1 is closed.

(source: http://www.seattlerobotics.org/encoder/mar97/basics.html)

Andy