When we think of patriotism, we usually have positive connotations; it's good to be proud of your country. In 1904 Ireland, however, resentment of English oppression could sometimes lead to patriotism that was so strong it became like a form of primitive tribalism. The result is that people worshipped everything that was Irish and had little interest in the rest of the world, leading to a very narrow-minded and insular way of thinking. Joyce, remarkable scholar that he was, could not condone such short-sightedness. He loved his country, but throughout Ulysses he demonstrates the traps of nationalist thinking, and his characters do their best to steer their way through them.
Bloom's moderate view of nationalism is a result of the fact that he comes from two different cultures. The fact that he is both Irish and Jewish allows him to both exist inside a culture and to see it from the outside of it; this makes him think of nationalism as an idea rather than just as a feeling.
The communal nature of nationalism makes it unappealing to the individual-minded Stephen, but Stephen invents his own form of nationalism, one where one strives for self-perfection and allows the nation to benefit as a side effect.