Slavery was a small part of it. As always, all roads lead to London.

At the beginning of the war, cotton impacted the livelihoods of one in five Englishmen in some way. Everyone was worried that the cotton embargo would destroy Britain’s financial might. But it turned out that there was a huge cotton glut in 1860.

There was too much cotton sitting in warehouses in England and it was bringing down the price of finished goods. So what the war did was rescue Britain from a serious industrial slump that was about to take place. For the first 18 months of the war, British merchants just used up the cotton that they had stored. Then, finally, when the cotton became scarce, truly, truly scarce midway through the war, there were other sources of cotton coming from India and Egypt.

By then, Britain had become completely invested in the war because of the war economy. Guns, cannons, rifles, bullets, uniforms, steel plating of all kind, everything that a war needs, Britain was able to export to the North and to the South. In fact, Britain’s economy grew during the Civil War.

Second of all, Britain was heavily invested because of the bonds. Both the South and the North needed to sell bonds on the international market to raise money to fight the war. The British were the largest holder of these bonds.