Generally, I tend to use "infant" or "child" in the same place people use "retard" as an insult.
"I can't plan a camping trip with more than three friends and expect it to go smoothly, but you think the government faked 9/11? What are you, a fucking infant?"
I think it works better, since everybody starts out as an infant.
But that's not to say I NEVER say "retard;" I do. And I don't really think of it as a problem. The day that using "retard" as an insult is the worst thing people do in discussions will be a wonderful, wonderful day.
I feel a little differently about calling things "gay." There really isn't anything bad or lame about being gay (other than how society might respond to it, I mean,) but most people would concede that, while mentally disabled people can be wonderful and productive citizens, it is still better not to be mentally disabled.