Sounds like the solution in a really weird game of "Clue," but no snark. Unless someone within the Yahoo organization has pulled off a spoof, it appears to be real.
The photo, attributed to photographer Ron Edmonds of AP, is on Yahoo here.
I googled in an effort to find any photo that this might have been spoofed from (as with the famous image of Bush reading a book upside down, while the undoctored photo was out there also).
As we all know, the Bush press team carefully manages every photo op. Some of the resulting photos , like his speeches, have contained apparent "hidden messages" addressed to in-groups of the faithful.
Does this photo document a hidden message to racists (and/or unreconstructed Confederates) out there, and if so, how scary is that?
I don't recognize the other flag in the photo. Do you?
P.S. History buffs, yes, the familiar Confederate flag shown in the photo is actually a battle flag. The Confederacy had other flags including more than one version of a national banner.
UPDATE: This image has been diagnosed by several below as showing the Mississippi state flag from a highly misleading angle. A pattern similar to the Confederate battle flag occupies the upper left portion of the state banner.