The "poster child" of Canadian "what might have been" is the Avro Arrow, a fighter, entirely designed and built in Canada, with performance equivalent to modern fighters, but which first flew in (are you ready for this?) 1958. Unfortunately, the Canadian government ordered A.V. Roe to stop work on its Jetliner project (which was also very cool), in order to concentrate all efforts on building CF-100s as quickly as possible for the Korean War. Then, when the company had no prospects in civil aviation, the government cancelled the Arrow program and ordered all the plans and tools destroyed, and the existing planes cut up for scrap. The team which built the Arrow was scattered to the winds, and the Canadian aviation industry, which seemed set to lead the world, has never recovered.
How did it happen? Any number of works could tell you that. In fact, many of them are listed in the bibliography of Shutting Down the National Dream, which was reissued to coincide with the release of the CBC mini-series The Arrow, which it inspired. Stewart tells the story well, and supports his points wherever possible with quotes from the people involved. One brief quote, not really on topic, but symptomatic, must suffice to capture the feel of the work. A.V. Roe used a converted Lancaster bomber as a flying test-bed for the Orenda engines used in the CF-100:
"On the odd weekend the Lancaster test-bed was used for a bit of joy riding over nearby New York State. The plane would be taken across Lake Ontario very low, and would then pop up to appear on USAF radar scopes. The P-47 Thunderbolts based with the Air National Guard at Niagara Falls would scramble towards the radar blip, but were never able to catch the fast-climbing, jet-propelled Lancaster." (p. 224.)
The whole story is inspiring in just what Canadians are capable of achieving, and yet tragic, that basic human flaws can destroy such marvels.