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The Domestic situation did affect the war a lot more than I think you're willing to admit (or know), but the Government screwed up big time in selling it to us, and even themselves. Which meant soldiers were faced with more time in the field, leading to severely decreased moral. We could have won, and I mean that honestly, but we divided ourselves, and were subsequently conquered, so yes, we lost the war.
Certainly, there was the possibility of victory for the United States, however, strategically speaking, they lost.