"...[N]ational heritage [is] a kind of ideological fossil created retroactively by the ruling ideology in order to blur its present antagonism." - Slavoj Zizek
There is definitely some weight to this idea. If I recall correctly most of the literature on the genesis of nationalism as an ideological phenomenon indicates it tends to form as economic development in a given society progresses from a primarily "feudal"/heavily agricultural/subsistence economic arrangement into modernity, and it almost always originates among the educated (read: well-off) classes. This is why I would suspect we didn't see the meaningful appearance of [political] nationalist sentiment in Newfoundland until the late 1960s/early 1970s; it was only then that the province had enough people well-off enough to give a shit about 'standing up for Newfoundland' (I don't think the Anti-Confederate campaign in the late 1940s was ever fundamentally motivated by nationalism [although it was obviously present, ideologically] - it was primarily a question of economic and political power for the business/political class in St. John's and the pulp-and-paper corporate fiefdoms of Grand Falls and Corner Brook. Confederation meant a loss of control by local [commercial, political, clerical] elites over taxation, economic regulation, etc etc etc.)
More importantly I think this particular idea - nationalism as ideology being a retroactive construction in order to mask a present social antagonism - is a good way to begin an analysis of the way nationalism has played a role in provincial politics since the beginning of the Williams administration. Presumably anyone reading this would be familiar with the way the provincial government has been shutting down political opposition (not just the Official Opposition in the House of Assembly, but wider media scrutiny and citizen dissent) by appealing to the Nation - recall the Premier answering Yvonne Jones' questions about the Abitibi expropriation (or the legal dealings with Quebec, or [political issue of the day]...) by implying she was a traitor!
The real question in this situation is to try and determine what social antagonisms nationalist ideology in its present manifestation is blurring. While I'm sure there are many, a few in particular grab my immediate attention - the 'conflict' between 'rural' and 'urban' Newfoundland ('rural' being primarily working-class, "traditional" economy of fishing, agriculture, manual labour, etc. with 'urban' being primarily the oil/gas industry, finance and commerce, etc.), and, as always, the broader class antagonism in this province that is beyond being pinned down to a matter of geographical location; I'm sure any of the unions who've run afoul of the provincial government could testify to this point.
Here I don't think it's hard to see why nationalism works so well as an ideology in the 'Zizekian' sense - what better way to override the actual antagonism between 'have' and 'have not' (to use the popular terminology) than to have us live within a conceptual framework where we are all 'Newfoundlanders and Labradorians', all of us united as a 'nation' with an illustrious historical narrative united against the Other[s] (the federal government, Big Oil/Pulp and Paper/Greenpeace, Quebec, etc). The provincial government here especially likes to make a full identification with nationalist ideology; the House of Assembly is where we are politically represented, and the governing party has an extraordinarily strong mandate (they control roughly 90% of the seats) with an extraordinarily strong executive branch - which leaves us with the bizarre political configuration where the Premier [on his own or through his cabinet] can effectively (if the opinion polls are to be believed) declare that "Le Nation, c'est l'Etat.. et l'Etat, c'est moi."
Obviously this is a very rough sketch of an ideological critique of the present political climate in this province. I think it's a good foundation at least, and if nothing else, some food for thought. But I definitely would consider it as something worth a bit of concerted research.