My take on what Goodwin Liu's request to withdraw his nomination to the 9th Circuit means for the nomination process:
The truth, though, is that in the past few years, this type of obstruction has become the norm rather than the exception. Obama has had the lowest confirmation rate for judicial nominees since Richard Nixon. Executive branch nominees have been confirmed slowly as well — often because of reasons as absurd as a nominee's opposition to torture or a belief that terror suspects should be tried in federal court.
The problem remains the filibuster itself. With Liu's nomination down, Democrats have every incentive to do what Republicans did in 2006 — cut a deal that allows some progress in the short term and then turn around and exploit the filibuster as much as possible when they're back in the minority. As long as the filibuster remains in place, and the structural incentives reward obstruction and discourage cooperation, nothing is going to change.
We'll see what happens next, but I'd be shocked if this was it for him as far as politics is concerned.