“Retarded” was initially a professional term used to describe certain mental disabilities. As it entered common usage, it then transitioned to the slur that it is today. I would expect that whatever the current professional terminology is today will be considered a slur in 5-10 years.

Which is a shame. It should go the way of dumb, idiot, moron, and be wrong to apply medically but ok to say casually. As Michael Scott said, "you don't call retarded people retarded, you call your friends retarded that are acting retarded"

When the reaction to a slur is pure confusion, then you've won.

That's interesting to me, since teenagers were really the only ones who ever used it. It's not just the subtext, since everybody says "idiot" and "moron". But I have a hard time imagining an f-bomb-throwing 50-year-old casually saying "retard" after a meeting or something like that.