When George finds the pocket knife with the ivory handle, he finds it in a watermelon. This is a symbolic image because the knife has an ivory, or white, handle and it cuts into a watermelon, which is a racist symbol for blacks. Thus, he subconsciously makes the connection of his world of black and white merging together. The interesting part is the watermelon is the symbol for the black part. As Sue says, she will never be able to raise these boys in a world that will accept them. Perhaps young George realizes this on some level as he associates himself with the racist symbol of the watermelon.
Carver: A Life in Poems