As an attractive succesful white chick, here is my theory:
I have a dear friend who is morbidly obese, and has been since childhood. He constanly makes fat jokes, which drives me up a wall... we had a long heart to heart and I demanded to know why.
His explanation after much thought and many difficult questions: He feels that making fat jokes or derogatory comments about fat people offers him a bit of protection. If he does it, it somehow lets others know that they don't hurt him; that they won't say it, or if they do, it doesn't bother him because he himself already took the sting and hurt out by doing it himself. When beautiful thin people say it, it hurts. He is very funny, just like the black comedians using the N-word on TV, and can get a whole crowd just roaring. But all that humor is just his way with dealing with the pain. I never thought it was funny, and I called him out privately after years of hearing it.
I believe it may be the same with black people... perhaps making "the word" their own and saying it themselves in a lighthearted way is their way of taking the sting out of this hurtful word if others shoud say it.
The problem: It's degrading and hurtful! Every time my friend did this, he hurt a little bit, only he was doing it to himself in an effort to control it hurt and prevent others from hurting or embarassing him. He is a wonderful person, a hard worker, and a devoted father... there is so much more to him than just being fat! How can people see that if they are too busy laughing at his fat jokes?
Bigger problem: I love him dearly and am protective of people I love. I told him, I would always defend him and anyone else I see being mistreated, and I want to kick anyone's a$$ who says these hurtful things, since when someone I love is hurt, I hurt too. So now, who's but am I supposed to kick? The person being rude and hurtful, or the person I love and want to protect from this emotional abuse? Because they are the same person.
Our agreement: He will not degrade or put himself down anymore, even in jest. He will hold his head up high and find other things that are funny to joke about. For every month he "stays clean" I take him out to dinner, or send him a "motivational" picture (I am an exhibitionist, but that is a whole other topic) as a reward. If other people say horrible things because of his weight, it's ok to feel hurt. Let them look like the cruel thoughless people they are... this did happen once, his worst fear, where someone had a hard time getting around him at the bar and let an insult about his weight drop. He was shocked to see that complete strangers around him stood up and responded and stood up for him, very vocally.
So now, he doesn't put himself down anymore and his confidence has actually improved a little, he gets to see that people like having him around, and that he is still wonderful, funny and well-liked without his fat jokes, and he also get to see that there are good people in the world, and many more than bad ones. Too bad he was almost 40 before he gave people a chance! After MUCH practice (this is a lifetime attitude) he now knows that even if one person or even a group of people say awful cruel things about his weight, he gets to see the good in the rest of the people who defend him, which is usually the majority.
I don't know if it is exactly the same with black people and the "N-word" or even similar, but it is a very cruel and hurtful word, designed specifically to tear down black people. Seems like it might be similar though, as a way to protect themselves from the pain and sting of other groups using it. If ALL of us take personal responsibility and object to this word, maybe those who have heard it their whole lives as an insult can also sit back and observe the good in people who will defend them against this weapon of hate. It is up to all of us though to change the stigma and let those who still use it to inflict pain know that we won't take it anymore. Just my humble opinion... sorry if I have offended anyone who has been hurt by this word by being clueless or off-base. I have my own emotional baggage and hurt, but being prejudiced against because of my color is not part of my experience. I can only try to understand, but it's not really possible not having experienced it myself.
One thing I do know... this word does not and will not cross my lips in private or in public. I can only control my own behavior, not anyone else's, but I sleep at night knowing I am not contributing to the problem, or using other's actions as an excuse to. My friends and family, even the ones who use the word amongst themselves, refrain from doing it around me out of respect for the same reasons my heavy friend doesn't make fat jokes anymore... they don't want to get their buts kicked when I get protective. :-)