Do we have a contradiction? Did John recognize Jesus, or not?

Some scholars are content to dismiss one or both verses as theological fabrications. While they may be included for theological purposes, that does not mean they must have been fabricated. There is a very simple solution to this.

First note Matthew 3:5-6, telling us what John did for a living:
> People went out to him from Jerusalem and all Judea and the whole region of the Jordan. Confessing their sins, they were baptized by him in the Jordan River.

This was probably a public confession. The person who came to be baptized somehow let it be known that they were confessing; most likely they confessed to John or one of his disciples prior to baptism.

Now let's put this into historical perspective. Jesus comes along for baptism... and does what? He confesses no sin whatsoever. John is probably astonished and thinking one of two things, perhaps even simultaneously:
1. This is the One I was waiting for? Why is He undergoing this rite of repentance?
2. How can I be sure that this is the Christ? I haven't been watching Him 24 hours a day.

Well, if you're John, you might just play it safe and assume that the man is telling the truth... that is, unless you want to allow that something about Jesus triggered a recognition (or revelation) in John as to Jesus' identity which elicited the statement of Matthew 3:14. From there, the settling of the Holy Spirit becomes a matter of confirmation that fixes the identity of Jesus in John's head once and for all.