Whatever the Union is willing to give them.
The Confederacy holds no cards at this point and their position is crumbling. Atlanta may be held, but its vulnerable. Atlanta is also way deep in Confederate territory, and its not a victory entirely denied to the Union--it is a matter of time and both sides see it.
Historically, McClellan wanted to win the war by different means. He'd have it his way and he'd win it his way. Getting someone like Horatio Seymour or Clement Vallandigham in the White House is a critical start.
Even then, the President of the United States is still supposed to support the interests of the USA. They owe nothing to the Confederate States and a peace deal that grants part of them independence is essentially the end of any responsibility for their well being.
The Union has the military power to do it, the leadership has every reason to support it, and I think the people would support it if the Union could WIN this treaty.
This is not going to be a nice, friendly treaty that gets floated around here of the Confederacy getting everything they want with a side of vanilla ice cream. Nor will it be a legitimate compromise of two nations that intend to form a long term relationship.
It will be a Carthaginian Peace designed to:
1. Make the seceding nation fail.
2. Claim victory as a result of the peace negotiations
3. Get the presidential peace dealer re-elected.
4. Reduce the considerable losses and costs of the Civil War.
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The USA claims all of Virginia on grounds that West Virginia IS Virginia. Current military lines will be held, the Shenandoah Valley remains in Union Hands.
Appalachia is given to the United States. This region cuts across most of the Southern States, but its largely Unionist. Further, a perimeter around this area for US Defensive purposes is claimed as well.
Tennessee is given to the United States.
Mississippi and Louisiana and Arkansas are given to the United States..
Florida is jointly administered by both the USA and the Confederacy.
Unionist Regions of Texas are given to the United States.
The Confederate States accepts 50% of all US Debts prior to the Civil War, and must also pay full market value for federal property seized.
The Union grants amnesty to all contrabands, USCT and escaped slaves.
The Confederacy must also renounce all claims to these regions, as well as the Missouri, Kentucky ordinances of secession. I think it would be interesting as well to insist on revoking Virginia's ordinance of secession and forcing "South Virginia" to re-secede.
In Exchange:
The Union will guarantee a land route for the purposes of interstate trade with Texas.
The Union will lift the Blockade, with the understanding that it will have naval bases in Florida.
All PoWs, Confederate and Union, will be returned home.
The Confederacy can reject these terms, but if they do so, the US President can claim to have sincerely attempted peace and honored his obligations to try for them. It is one matter for the US President to consider reasonable terms given his position, another entirely for them to give away the deck and throw the war for the Confederacy.
If the Confederates accept the offer, this US President will watch as "volunteers" from the Union continue to support slave rebellions all across the South, as the Confederate States slowly collapse owing to ever increasing taxes, hyperinflating currency, and a Civil War of its own raging on its own.
I'm not fully sure what happens when people like Garrison and Fredrick Douglas decide that they can bring the Confederacy down for good by collecting donations that are translated into weapons for slaves and freedom fighters in the South.
The Confederacy won't survive, and that's entirely intentional. Milked dry by US Demands for payment, stuck in a civil war of its own and running low on manpower, the Confederacy finally collapses when poor Whites start joining the riots against lack of food, the great burden placed on them and their leaders fighting for landowners that aren't them.
They ask for, and are approved, as US Territories.