Texas Gov. George W. Bush, at a debate of Republican candidates last night, refused to answer whether the Confederate flag offends him, deflecting the divisive racial issue in a state that will hold the South's first primary next month.

"I believe the people of South Carolina can figure out what to do with this flag issue. It's the people of South Carolina's decision," Bush said to cheers from a boisterous audience of 3,000.

The debate over whether to remove the flag over the South Carolina Capitol has consumed the state in recent years. The NAACP has called for a tourism boycott until it is removed, and today flag supporters began a three-day rally at the statehouse. But Bush, who has staked his campaign on being able to broaden his party's appeal among minorities and women, would not be drawn into the fight.

As MSNBC anchor Brian Williams pressed Bush to give his personal opinion on the issue, catcalls and boos filled the banquet hall where six candidates fielded questions on topics ranging from their charitable contributions to their past mistakes.

"I don't believe it's the role of someone from outside South Carolina and someone running for president to come into this state and tell the people of South Carolina what to do with their business when it comes to the flag," Bush continued, again to more cheers.

Bush also evaded a question about a gambling moratorium in South Carolina, saying, "Just like the flag, the people of South Carolina can figure out if they want to have a lottery or not."

Later, GOP rival Gary Bauer, given the opportunity to question Bush, joked: "This is the fourth time in a row that I've drawn your name to ask the first question to. I think the odds are 10,000 to 1. I think I'm going to keep drawing your name until you actually answer the question."

Arizona Sen. John McCain again faced questions about his interventions with federal agencies on behalf of campaign contributors, this time over a letter on behalf of the communications giant Ameritech.

And McCain again defended his actions as appropriate service to citizens thwarted by bureaucracies, characterizing them as just part of his duties as chairman of the Committee on Commerce, Science and Transportation. He said that "all the times when I have weighed in I have asked [the agencies] to do their duty and to expedite the procedures as they're laid out under the law and according to existing regulations."

It was a far more regimented session than the one the night before in New Hampshire--each candidate fielded a question with a 45-second answer--and yielded much less rhetorical scrapping among the candidates.

While the candidates had limited opportunities to clash, the audience picked up the slack. They cheered antiabortion affirmations, calls for school choice and anti-gambling statements.

Publisher Steve Forbes used a question about negative advertising to refer to a new attack he has launched against Bush on taxes. Bush also defended his $483 billion tax cut proposal against a charge by McCain that the cut is too drastic a promise that people can't keep.

"I'm more concerned about the surplus gap," McCain said to Bush, drawing applause for suggesting more of the surplus be used to pay down the national debt. "You've promised a huge tax cut based on a surplus we may not have."

Bush responded by saying that a family with a $42,000 income would receive an $1,852 tax cut, compared with a $200 cut under McCain's plan. "The fundamental difference is that the additional $1,600, the difference would go to Washington under your idea and under my idea it goes into people's pockets," Bush said.

The crowd booed loudly when the candidates were asked by a questioner in the audience to admit to the biggest mistake of their adult lives. Utah Sen. Orrin G. Hatch said, "I've made so many of them in my life that I'm not sure I can pick any one of them." Bush joked about trading Sammy Sosa as an owner of baseball's Texas Rangers. But it was former diplomat Alan Keyes who took the prize when he said: "I think about the biggest mistake I might make as an adult would be to treat that as if it's a question that is appropriate to be asked."

The debate foreshadowed what is likely to be Stage Two of the GOP nomination battle. McCain's strategy for upsetting Bush hinges on a strong performance in the New Hampshire primary Feb. 1 followed by an 18-day sprint to the South Carolina primary. Bush wants to build a fire wall around McCain by winning the Iowa caucus a week before New Hampshire and sealing his nomination with a win in South Carolina.

Tonight's event, held in an empty warehouse--turned into a banquet hall--that once housed a Lowe's home improvement store, was marred by technical difficulties. There were traffic problems outside, sound problems inside, and at one point during the debate, the MSNBC sign slipped from its position and dangled on the stage, causing an MSNBC worker to jump onto the set and pull the sign down.

It was the second debate in as many nights for the Republicans. Between the two events, Forbes began airing a 30-second television ad in New Hampshire accusing Bush of breaking a vow in 1997 not to seek tax increases in his state. The spot features Mary Williams, head of the Houston-based Taxpayers for Accountability, saying Bush reneged on a 1994 promise to her organization not to back tax increases.

Bush did not directly address the issue in the debate last night, but he and campaign aides responded angrily at events earlier, saying Forbes had distorted the issue. But Forbes defended the decision to run the ads in the debate last night. "I believe that the American people want an honest, open and vigorous debate about the issues," he said. "You make a tax pledge I believe you should keep it."

While the ad was technically correct in asserting that Bush supported an increase in sales taxes in 1997, it failed to mention that the proposed increase was more than offset by a proposed property tax cut that would result in a net tax decrease of $1 billion. Bush eventually signed a bill that year that decreased property taxes without increasing the sales tax, his campaign said today.

"There's always a tendency in politics when things aren't going well on the positive side to resort to the negative," Bush said in a pained voice at a morning news conference in New Hampshire.

The Forbes ad evoked memories of the 1996 campaign, when he pummeled the eventual nominee, Robert J. Dole, for his position on taxes. Bush alluded to that history, saying he "thought [Forbes] should have withdrawn the ads he ran against Bob Dole in '96."

Still, Bush seemed acutely aware of the problem his father ran into after he abandoned a famous pledge made in 1988: "Read my lips, no new taxes." As reporters pressed him on whether he would rule out increasing any tax as president, Bush repeatedly interrupted his questioners, correcting them and challenging their premises. Eventually, he said: "I don't intend to increase taxes, but I intend to cut them."

Staff writers David Von Drehle in Washington and Dana Milbank in Columbia contributed to this report.