No, the Confederate Flag is not inherently racist. It has only been framed that way as a wedge issue by liberal groups who have pressed to have it banned, and rally liberal activism.
Unless a confederate flag is flown in blatant support of racism or hostility toward blacks, I don't see it as racist. I see it as :
1) honoring our history, and those who died, on both sides in the Civil War. Both sides were Americans who fought with honor and chivalry, in the war with the most casualties of all U.S. wars.
2) Flown to manifest a regional pride in coming from the South.
As Zell Miller pointed out on MEET THE PRESS during the 2004 election campaign, southerners enlist, fight for and die for the United States in disproportionate numbers.
There is a sense of independence and heartfelt patriotism in the South that is seen as making us as stand out from the rest of the U.S., that relative to places like Boston, New York City or San Francisco (the latter place where ROTC and military recruitment has been banned from college campuses!), we are the real Americans, its most ardent defenders.
It's a myth that the Civil War was fought to free the slaves. It was fought solely to preserve the Union ("to free the slaves" was postwar revisionism)
Lincoln did not free the slaves until late in the war. And initially, only Confederate slaves were freed, not the slaves of Union officers, or Union war financiers.
The issue has been oversimplified.
--A proud Florida Boy