It's... complicated. Kaissreich itself is a game mod, but rather than refer you, I'll do my best to explain.
Basically, because the Central Powers win WW1(basically USA never enters WW1) widespread chaos occurs in many Entente countries. England, France, and Southern Italy(long story with that one) become Syndicalist. Not Communist, Syndicalist, which is a VERY different ideal(although totalism in the game is close at times.) Global Socialism is no longer influence by Marx as much.
In America, this leads to the 1920s having economic decay, as the Central Powers deny us access to markets, and all the countries that became Syndicalist default on all the loans we made to these countries during World War 1.
When the Great Depression hits(this time influenced originating in Berlin) the USA splits into FOUR different nations. A Syndicalist part in the Northeast led by Jack Reed, a Fascist(Fascism doesn't technically exist, but this is basically Fascism) state led by Huey Long in the South, a laize-fair nation in the West, and the USA holding at the beginning everything else(which is usually led by a Mcarthur who coups the government.) The nation names are the Combined Syndicates of America, the American Union, the Pacific States, and just the USA respectively.