Keeva has an excellent post on the use of offensive language here. What I find curious about the post is the almost apologetic tone of it, as if it is somehow unreasonable to ask people to stop being racist, sexist or ablist.
I'll be a little more direct. If you ever describe someone you dislike as a "retard", something you dislike as "gay", someone you think is being mean as a "Jew" or a victory as "rape", the very least you can expect is a permanent /ignore. I don't care if it was "just a joke" or "that's just how people like me speak" or that you think it's "political correctness gone mad".
If you're in any party or raid I have any control over, I will kick you. If I'm an officer in your guild, I will /gkick you.
Except ... I don't.
I rage at my monitor, sometimes put repeat offenders on /ignore, but mostly I stay silent and do nothing. Anything for a quiet life; just collect the epics and go. I suspect most other people do too.