racially retarded is a word used for people who do not see skin color or origins. It's kind of hard for them to understand that someone is from another ethinicity. They treat everyone the same in an unbiased way and in some cases it takes them awhile to see that people that they meet are different from them.
Sam: I think I'm gonna get a tan this summer. Would like to come with Jill.
Jill: Umm.... No thanks. I don't need a tan. I'm already brown?
Sam: Oh! You are! *surprised*
Jill : Sometimes I think you're racially retarded.
The example sucks but I think you guys get the point.
Pasty white people who live in the middle of the country who have convinced themselves that they are black.
These are common in the more rural areas of western NY and are a specimen worth the time it takes to make fun of them.
In most cases these racially challenged people have never been to a real ghetto, but claim to be from one. Often they will say things like "straight outta compton."
If you know one of these people call attention to their problem and adress them as "vanilla ice".
There are several racially challenged people at Alfred almond Central School which is in the middle of nowhere.
you may find a picture of one at www.aacs.wnyric.org