Since we’ve already spent a whole movie with Jar Jar, his character must evolve going forward. I mean that literally. Since it’s been 10 years since TPM, he’s put on a lot of weight and his voice has gotten deeper. He’s becoming a Boss Nass figure in the Senate, and is actually one of the few senators who listens to the plight of the young and downtrodden in the galaxy. One of his primary interests is in demanding that the Republic enforce its anti-slavery laws (with the help of Anakin and Padme). He’s frustrated by the Republic’s lack of power as it is continually thwarted by local military uprisings and powerful galactic corporations.
Padme is still a queen of Naboo, and as such has some power in the Senate. She is also frustrated by the Republic, but she doesn’t believe that military might is the correct answer to the Republic’s problems. She prefers diplomatic solutions to problems, and has been working on the anti-slavery initiative for years behind the scenes, quietly convincing planetary leaders of the benefits of droid labor.
Anakin has become a prodigy Jedi. Obi-wan has grown to truly care about his student, and is proud of Anakin’s accomplishments. They continue to serve as the galactic law enforcement, but the Jedi Order is leery of the mechanization underway in the Republic. The Jedi view automations as unnatural and some even view them as evil. Droids are banned from piloting Jedi starships, and Obi-wan wants nothing to do with them. Nevertheless, Obi-wan has a defiant streak from his apprenticeship under Qui-gon, and is one of the few Jedi totally dedicated to finding and destroying the Sith menace, even going against Yoda at times.
The plot has similarities to AOTC in its broad outline. The senate is voting on whether to create a droid army to enforce their laws, and Padme has come to Coruscant to argue against the measure in any form, believing that the Jedi are capable of protecting the galaxy. Anakin is also against the measure, but secretly believes that a conscripted army would be an acceptable solution. He joins Padme’s side as the most outspoken Jedi on the counsel. Jar Jar merely wants an army of some kind. On the eve of the vote, word comes that there has been a droid uprising on Tatooine. Anakin and Padme return to Tatooine to find Shmi dead and her new husband Owen inconsolable. Anakin, through his mechanical brilliance, discovers that C-3PO has received a transmission from off-world which was distributed secretly encoded en-masse and had lead to the uprising.
Meanwhile, the uprising has spread to numerous worlds, including the highly mechanized Coruscant. Palpatine is apparently captured in the uprising. The government is incapacitated and communication impossible, so Padme, Anakin, and Owen leave to trace the transmission to its source.
Obi-wan has been working to track down the Sith for years, and at this time he gets a lead to the homeworld of the Nemoidians. Little does he know that it is the transmission that has drawn him there, and when he arrives he sees that the droid army of the Trade Federation (which has been decommissioned after the Federation fell out of power) has been building its own factories and generating massive armies of much more powerful droids, apparently on its own. The droids are cloning themselves at a tremendous rate, and Obi-wan is captured.
Our heroes infiltrate the droid’s factories and rescue Obi-wan, but not before Anakin is gravely injured and confronts his dark side. The Jedi, who are spread thin in the galaxy trying to protect against all the uprisings, can send only a few Jedi to fight the droids.
Palpatine, who had been ‘captured’ in order to lead his new mechanical army against the weakened Republic is thwarted when Jar Jar of all people arrives leading an army of eager new recruits to battle. It turns out that Jar Jar was able to rally the population of Coruscant and mount a rescue, and so the day is saved. Palpatine returns to the government with nobody the wiser, there’s a new Republic Army, and the droids are now resurgent throughout the galaxy where Episode 3 picks up.
Whew, that was a bit more long-winded that I expected.