It may also be the bushings... but for sure the bar that is in the middle of everything (connects to the bolt w/ bushings on it) is broken on that side. It is almost as if it was a perfect split horizontally where it connects.

The circled part in the picture basically shows that the rusted piece is actually part of that bar in the middle... and it spins around the bolt... what part number is that middle sway bar and is it pretty difficult to replace?