Previous accounts of the Canadian Shift, which have interpreted this diachronic process as a purely phonetic consequence of the low back LOT-THOUGHT vowel merger, have not clearly explained the strong connection between phonetic TRAP vowel retraction and the phonological process of the low back merger. This paper addresses this issue in several ways. Relying on the Modified Contrastive Specification theory (Dresher et al. 1994) and the Contrastive Hierarchy approach (Dresher 2009), two phonological frameworks, as well as phonetic insights from Vowel Dispersion theory (Liljencrants and Lindblom 1972) and Dispersion-Focalization theory (Schwartz et al. 1997, Schwartz et al. 2007), we propose that the catalyst of the Canadian Shift is a three-way merger of the PALM, LOT and THOUGHT lexical sets, in combination with a simultaneous change in the underlying feature specifications of the TRAP vowel. This results in a phonology that allows for the TRAP and DRESS vowels, in particular, to undergo the influence of the phonetic principles of dispersion and focalization, which lead to lowering and retraction in the acoustic vowel space. Comparison of data from speakers in Thunder Bay, Ontario, and Cape Breton, Nova Scotia, lends support to this hypothesis because the Cape Breton data reveals evidence of two concurrent phonological systems, despite no evidence of change over apparent time. Some Cape Breton speakers display the Ontario (i.e., inland Canada) Canadian Shifted vowel system, while others display a system that bears much greater resemblance to the Eastern New England non-shift dialect, where PALM merges with TRAP instead of LOT-THOUGHT. The current analysis thus predicts that the Canadian Shift or a similar change to the TRAP, DRESS, and KIT vowels will occur in any North American dialect where the PALM-LOT-THOUGHT merger occurs, unless an intervening phonological change alters the contrasts within the phonological system.