Farang is not anymore racist than "gringo" in South America or " muzungu" in Africa. Let us not forget that we white people have a history in the world! However, what bothers me in Thailand is how it is used, which is a bit different. Thais will talk about you in your presence as "farang" when they know your name, which is very rude, and there is also a very irritating tendency to blame
"farang" for everything under the sun, which even the colonized South Americans and Africans rarely ever do. Frankly, rather than being racist, I think the Thai use of the term betrays an inferiority complex, if anything, so I never take it personally!:)