But I have seen no evidence of any movement to denigrate denigrate, and just now a Google search on the word failed to reveal any.  On the second page of results there is a link to a story “Any Excuse to Denigrate Radical Feminism”; I’m pretty sure that if there were such a movement, people who defend Radical Feminism would be the first to join up.  So I think this is a red herring (no offense to herring).

Yes, the link in my post was the solitary instance I found, but I recall that the initial report of the guy who was reprimanded for using the word ‘niggard’ was greeted with amused disbelief at first (at least in the British press). Now it appears to be almost taboo in some quarters. Certainly, it’s a rare word and I can’t remember when, if ever, I have had occasion to use it, but to avoid it altogether seems to me almost condescending, as if your audience has neither the wit nor ability to recognize the word for what it is.

So, problematic I’ll grant. But never to be spoken or written again? Completely absurd and on a level of avoiding constable and country for fear of giving offence to maiden aunts by the sound of the first syllable. (There was, in fact, a fashion among some British rowdies in the 60s of greeting policemen with a hearty, “Hello, cont-stable!” - heavy stress on the first syllable, slight pause before the second).

It seems to me this discussion has conflated distinct concepts:  how should one refer to other people, and should certain words be considered taboo due to spurious etymologies or sharing syllables with another taboo word.

The first question is straightforward, for the reasons Languagehat gives:  you get to choose your own name, and polite persons respect this.  There may be limits to this.  If I demand that my friends and coworkers call me “Yahweh” or “Emperor Palpatine” I can’t reasonably expect universally positive responses.  And if someone from back home slips and uses my old name, I ought not take offense.  But as a general approximation, the rule is sound.

The second question is far more problematic.  It gives other people the power to declare innocent speech to be offensive, and even to apply this retroactively.  The guy that was fired for using “niggardly” had no rational reason to believe this to be offensive.  Yes, his bosses were embarrassed into reinstating him, but the fact remains that he was penalized for a word retroactively declared taboo.  That “no rational reason” bit is important.  While we can all sort of understand how “niggardly” could be misunderstood, the fact remains that the objection is based on bogus facts.  So just how bogus can these facts be and still count?  The word brought up so far in this discussion has been “denigrate”, but the better example is “picnic”.  See http://www.snopes.com/language/offense/picnic.htm. Scroll down to be bit about SUNY/Albany.  In particular, everyone agreed that the facts were bogus but they couldn’t use the word anyway.  (They tried changing it to “outing” until the gay students objected.)

In practice, with regard to the specific case of “niggardly” I might in some contexts avoid the word to avoid distractions.  This is in exactly the same way I avoid using “which” in a restrictive relative clause when discussing grammar:  doing so would give ignorant people an excuse to complain.  But in reality, not so much even that.  “Niggardly” is a somewhat rare and bookish word.  If addressing a somewhat rare and bookish audience, I would not expect a problem.  If addressing a non-bookish audience, “cheap” is of a more appropriate register.