December 31, 1861 – The year closed with southerners optimistic about gaining independence and northerners pessimistic about preserving the Union.
Confederate prospects were promising going into 1862. They had won impressive military victories at Big Bethel, Bull Run, Lexington, Wilson’s Creek, and Ball’s Bluff. Independence seemed likely, as the correspondent for the London Times reported from Washington that “the Union is broken for ever, and the independence of the South virtually established.”
For the Federals, they had won significant naval victories, capturing Hatteras Inlet, Ship Island, and Port Royal. They had also won minor land victories at Philippi and, more recently, Dranesville. They controlled western Virginia and were dominant in Kentucky and Missouri. Their blockade was also growing stronger, and they were beginning to drain labor from the South by confiscating slaves.
However, a supposed diplomatic victory turned into a setback of sorts in the Trent affair. The Federal armies, though numerically superior to their adversaries, remained stagnant in all theaters of operation, with General-in-Chief George B. McClellan seriously ill with typhoid and unable to command.
Perhaps most importantly, the U.S. was facing a financial crisis, as many northern banks suspended specie payments. The war cost northerners an exorbitant sum with no results to justify such a high amount. For this reason alone, prospects for the Federals seemed dim going into next year.
Bailey, Ronald H., Forward to Richmond: McClellan’s Peninsular Campaign (Alexandria, VA: Time-Life Books, 1983), p. 64-65; McPherson, James M., Battle Cry of Freedom: The Civil War Era (Oxford History of the United States Book 6, Oxford University Press, Kindle Edition, 1988), p. 367