[illini99]

I believe the PC term is "persons with mental retardation." At least that was the preferred term 3 years ago when I took a class on mental retardation (also called "Retardation: A Celebration"). "Mentally handicapped" may have been the term before this term. Idiot was the preferred term 150 years ago.
There have been numerous other terms to describe mental retardation in the interim. I believe all of them were rendered obsolete because they became offensive. So... just wait a decade or so and calling someone a retard won't be offensive. It'll be an outdated term on par w/ "idiot" or "moron."