Ratatouille Latkes

2 medium yellow squash, shredded on large holes of a box grater (2 1/2 cups)

1/2 cup minced red bell pepper

1/3 cup grated onion

1/3 cup chopped basil

1/4 cup all-purpose flour

1 large egg

3/4 teaspoon salt

1/4 teaspoon ground pepper

1/4 cup olive or vegetable oil

FOR TOMATO-CAPER RELISH:

1/2 cup chopped tomato

1 tablespoon chopped fresh basil

1 1/2 teaspoons nonpareil capers, rinsed and drained

1 1/2 teaspoons olive oil