"Retard" is the perfect length for an insult and lends itself very well for emphasis. It rolls off the tongue in anger or disgust very well. Like with most insults, nobody even thinks about what it actually means (see: "motherfucker", "dumbass", etc) any more.

Furthermore, nobody calls the intellectually disabled "retards", and "retarded" is also quite rare now as is "mental retardation". So "retard" is perfect for repurposing as a general purpose insult. People who get up in arms about this are basically saying that the mentally handicapped are retards, which they are not, a "retard" is NOW your dumb friend who you are making fun of, and not an intellectually disabled person you never met.

Get angry about something else. Removing the slur from the intellectually disabled is a good thing.