"In 1919, Nuremberg vanished in a pillar of fire that nearly tore Germany apart. In 1942, that Hellstorm still burns bright"
Around the Nuremberg Hellstorm is a 200-mile radius area of high mana (Magiezone) nearly all of which is in the boundaries of the Third Reich. This has resulted in nearly a third of the German population able to cast spells though the normal mana in the rest of the world limits how many of that population can cast spells outside the Magiezone.
All sides work to breed ever-larger and more-powerful dragons (though a few worry about the consequences of creating intelligent beings more powerful than humans) Each side’s propaganda accuses the other of trafficking with demons the truth of which is unknown.
Of the nations of the world only the Soviets culturally accept “chimeras,” magically mutated blendings of man and beast (seeing them as proof of Lysenkoism). The Germans, in their quest for racial purity, do their best to hunt and exterminate them.
The various nations (or at least their citizens) took advantage of the sudden appearance of magic in the 1920s: American Gangsters used spells and Britain's Oxford and Cambridge established magical colleges.
FDR created the Thaumaturgical Study Administration in 1934 to coordinate and develop magical responses to the Depression.
Stalin's purges have left the USSR with the lowest level of magic use of any major military.
The Axis power heavily regulate magicians forcing them to register with the government. Germany Jewish and other “subhuman” magicians are executed on the spot for fear of a riot similar to the one that leveled Dachau October 1941 occurring.