A stupid joke made (mostly) by Americans, based on the rationale that if the citizens are called "Canadians," the country should be called "Canadia," while forgetting that their own country has "Washingtonians," "Floridians," "Indianians," "North/South Carolinians" and "Oregonians" despite not having states named Washingtonia, Floridia, Indiania, Carolinia or Oregonia.
American: If yer Canadian, why isn't your country called Canadia? Are you stupid? Har har har!
Canadian: Why don't you recognize how stupid that sounds?
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