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Just because the new name may be geographically accurate doesn't mean it was a good idea to change it.

The change was clearly for propaganda reasons, and that is what makes people upset

Because it’s weird and stupid and random.

That’s basically what they did. It’s obvious that “America” here means USA, not the continent.

I'm sure the United Statesians didn't mean that.

America is an extremely common synonym for the USA, for better or worse. It's not convincing to imply that you believe a president of the USA, renowned for his nationalist rhetoric and pettiness, renamed a geographic feature bordering Mexico and the USA from "The X of Mexico" to "The X of America" not as a reference to the USA.

Regardless, it's antagonistic to the namesake for no good reason, no matter what the new name is.