cogadh: That aspect does vary from region to region. In the South/South West, all Latinos are "Mexicans", while in the South East, they are all "Cubans" and in the North East, they are all "Puerto Ricans". It's not so much racist as ignorant, though I consider ignorance to be a pre-requisite for racism.
That is why, when practicing bigotry and/or racism, it pays to generalize. Using a slur such as 'spic' in this case would have saved this man ("Ghost", is it?) a world a semantic headaches. Seriously, this is Prejudice 101 here: one must first dis-individualize everyone by stereotyping. Only THEN can one truly move into the upper echelons of bigotry (Prejudice 205) and racism (Prejudice 348). 'Ethnic Cleansing', sadly, is only offered as a graduate level course at the University of Asshattery.
/bad joke