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In 1864, during the American Civil War, John Wilkes Booth, actor with links to the underground Southern movement in the North, came up with a plan to kidnap President Abraham Lincoln, while the latter was attending a theatre performance. In OTL Booth's associates dismissed his plan as impractical. Booth was to then follow a course of action which led to him assassinating Lincoln on 14 April 1865.
In this timeline, however, Booth's plan is considered, and his associates come up with a more practical plan. The security associated with the President was minimal (and was to remain so for a long time thereafter - in OTLassassinating the President was not to become a Federal crime until after JFK's death). It was decided to pursue a more practical version of the scheme and arange to kidnap Lincoln in a more accessible location.
This is done, and, shortly before the 1864 election, Lincoln is kidnapped and a ransom put to the authorities in Washington. Much consternation ensues - there is no historical precedent on what to do.
The Jefferson Davis government of the Confederate states is horrified at what has happened - not only is it contrary to the 'law of civilized states' but Booth in a statement makes it clear he wishes to use the ransom money to finance the Confederate cause. World opinion of all shades blames the Davis government and all shades of opinion from the autocratic Tsarist regime and Pope Pius IX to (what were then considered) democratic states, issue formal ending of relations with the regime in the South.
As the Confederate regime, beset by international opprobium and severe financial difficulties, making a desparate attempt to salvage their reputation, is effectively paralysed, Booth's group face the ultimate setback. Lincoln, who possibly suffers from Marfan's syndrome, has an undiagnosed heart problem,.which, exacerbated by the stress of the kidnap, leads to Lincoln's death.
The conspirators realise that they have no way out - they will be seen as having killed Lincoln - the Washington administration will have full justification in imposing any conditions they see fit on the Confederate side.