Before the Earth was shattered, magic came from the gods, both divine and arcane magic existed due to the attention and power of the gods. Arcane was more democratic — anyone learning its rules could cast them, but Divine was easier to master, as all it required was the agreement of a deity to grant the needed spells. Nevertheless, the gods are gone, and no longer mediate the connection to the Astral, Ethereal and Shadow plans. There is nowhere for magic to come from.
Only, that’s not quite true.
The exposure of the innermost core of the planet revealed Magicite1, a form a crystal which allows for a both channeling and storing of magical energies. Wizards and Sorcerers are people who can connect to such crystals and channel power from the elemental plans; Clerics and Favored Souls are those who can do the same with power from the astral. No one in Haven has been able to connect to the Shadow plane, but that is perhaps for the best.
Unfortunately, most of the magic knowledge was lost in the cataclysm, or never really available. Priests and Wizards can only learn new spells as they are found or rediscovered, and many spells (such as those that commune with outsiders or detect alignment) no longer work at all.
For game-specific rules, see Magic Rules.
1 This is a truly horrible name, and promise to change it to anything the players want,so long as it’s PG.