Matt: Wikipedia says this about the cancellation.
'Within two months of the project cancellation, all aircraft, engines, production tooling and technical data were ordered scrapped.[89] Officially, the reason given for the destruction order from cabinet and the chiefs of staff was to destroy classified and "secret" materials used in the Arrow and Iroquois programs.[90] The action has been attributed to Royal Canadian Mounted Police fears that a Soviet "mole" had infiltrated Avro, later confirmed to some degree in the Mitrokhin archives."

So not the USs fault. Canada's.

Christian: Not sure about your comments regarding German engineers. Indeed superb but 'best in the world' is a hard claim to quantify. The worlds most awesome bridges, roads, buildings, tunnels, planes, ships, submarines, oil rigs etc have all been built by other nations and other nations engineers. It might be a good idea to avoid bigging up Hitler and German engineering in the same post. It just comes across badly.