What's the big deal about Political Correctness?

What does being "Politically Correct" mean?  According to Merriam-Webster Online, it means "conforming to a belief that language and practices which could offend political sensibilities (as in matters of sex or race) should be eliminated"

I got into an argument with a "friend" on Facebook a few days ago and it didn't end well.  He was livid about having to be politically correct about the word "fag".  In his view, it used to mean "asshole" and why can't it still be used that way.

Guess what?  Times change.  People are living more authentically and out loud, regardless of who knows, and minorities are not just sitting down and shutting up.  They are learning that their place is no longer in silence or in the back of the bus or in the closet.  Those in power (and as a generalization that was straight, white, and male) could do and say whatever they wanted with very little regard to consequence.  They were allowed to also dole out consequences to people who would do and say things they didn't like.

Now, while there are still plenty of consequences for minorities and other groups to do and say what they want, but there is also more expectation that there be consequences for the previously-in-power when they say or do something that violates another person's well-being.  And they don't like that.  Hence their anger towards what they call Political Correctness.  Apparently we (liberals, minorities) are "snowflakes" when we want to be treated equality or with kindness or to have our very existence simply accepted.

I saw this online by Michael Bernard, a writer on HuffPost, Slate, and other such sites:
"Pro-tip: whenever someone is moaning about political correctness, ask them what it is they would like to say if they weren’t constrained. Then don’t be surprised if it is demeaning, derogatory or disrespectful to people who traditionally were considered inferior to the person."

Honestly, this is pretty spot on.  Political correctness isn't supposed to be about stifling freedom of expression.  It IS about acknowledging that there are others out there who are different from us and who deserve the same level of respect and acceptance as those who are traditionally allowed to simply live their life.

I think that a lot of opponents of political correctness don't quite understand it.  Here's a great example of this: 

It's not politically incorrect to say those things in a home and I don't believe that the majority of the left or politically correct crowd believes that any of these things are inherently wrong to say.  Someone said "Merry Christmas" to me the other day and I said it back, even though I am not Christian.  WHOA!  We celebrate it as a day to give gifts - not as a religious holiday.  But when someone said it to me, I said it back.  No big deal.  I say "Happy Holidays" because I acknowledge that there is more than one religion in the world and I live in a religiously-diverse city.  I don't say "God bless the USA" but I don't mind when someone else says - UNLESS it is to mean that no other country can also be blessed.  Tolerance is key - not necessarily acceptance.  There is a difference.

Getting back to the argument online I had, part of my response was that people who oppose using the word "fag" feel that way because of the derogatory nature in which that word is so often used.  The fact that he meant it to mean "asshole" about someone else proved my point right there.  But he didn't see that.  It was just a word, he claimed.  And that's what a lot of opponents of political correctness say - they are just words and people need to toughen up.

And yet: