"They call me MISTER Nigger."

When young black people use the word nigger, the message to white people is 'we have reclaimed this word for ourselves, and we can use it when you can't.'
That's all. It is a minor act of petty linguistic theft, in part to make up for the appalling crimes of history. The fact that it's 'not fair' is the whole point. 'This is a tiny taste of what it feels like.'
 So there isn’t any hypocrisy, merely a chance taken to make white people feel uncomfortable. Which is fair enough. Quite funny really. And judging from general reaction - job done it seems.
 Now the new street usage may not be a productive or rational tactic, and many black leaders condemn it. But it probably feels good. And another thing. It's use requires CONSENT, which requires contact and communication. In other words, you need to have some form of relationship with the recipient before using it. This again reinforces a sense of identity and kinship and places the emphasis on human contact.. And who can argue with that in a society in which the sense of community is all but dead?
 A world in which a black person gave a white person permission to call him a nigger would be a world without racism. Maybe it could happen in fifty years, if the word is ever washed clean of its history. But it'll take a lot of effort and understanding to do that, and I don't see a lot of that around.
As for the word itself. Try this. Say "Negro" with a Glasgow or Belfast accent. Most of the early middlemen and plantation enforcers were simple farmhands or failed tradesmen or criminals trying to better themselves in the New World. They didn’t speak BBC English.
 So strictly speaking, nigger may well be just an English-speaking corruption from the Latin or more likely Spanish root(negro/negra>nigger) but the fact is that in each form, it was used to refer to people as units of production. It dehumanised black people. They were not people but different brands of slave:
 On Sale Today
3 bull niggers - ages 20 -30 years. All own teeth.
2 She-Mullattos - child-bearing age.

Etc.

It is offensive also because it is an example of a word which has become poisoned by its usage and the history which allowed that usage. The power of words is not limited by the professors at the OED. Words can become tainted by their surroundings. 'Cripple' is another one, off the top of my head, now only ever used as an insult, and never towards people who can't walk. 'Cripple' is a very useful word, but irredemably negative, and therefore not useful as a word for a group of people who have enough problems to deal with. But in terms of sheer injustice and blood, that is not as bad as 'nigger'.
The overall message is: There’s no point getting fussed about black people using it as and when they like, they’ve earned the right to do whatever they want with it. And if ‘That’s SO Unfair.’ Then tough. Find your own word to hijack.

'N'- word Sighting In School