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I don't see what's wrong with racism in a game. Racism exists in real life. It exists in literary works. I think its fair to use racism in games. All Nintendo would have to do to eliminate this problem would be to introduce darker skinned Hylians.

But wait, in the LotR movies aren't the Orcs etc dark skinned!? And they are portrayed to be evil! RACIST!

The difference here is white people = human and black people = human. The only real difference is skin color.
However, in reality Gerudos, Hylians, Zora, etc are not different races, they are different SPECIES. Just like Orcs are not human, therefore you could not say that LotR is racist.

This whole accusation is like having an outcry against us imprisoning Monkeys and Apes in Zoos because it is racist.