And read this WaPo piece for the full story:
Democrat James Webb's Senate campaign accused Sen. George Allen (R) of making demeaning comments Friday to a 20-year-old Webb volunteer of Indian descent.
S.R. Sidarth, a senior at the University of Virginia, had been trailing Allen with a video camera to document his travels and speeches for the Webb campaign. During a campaign speech Friday in Breaks, Virginia, near the Kentucky border, Allen singled out Sidarth and called him a word that sounded like "Macaca."
"This fellow here over here with the yellow shirt, Macaca, or whatever his name is. He's with my opponent. He's following us around everywhere. And it's just great. We're going to places all over Virginia, and he's having it on film and its great to have you here and you show it to your opponent because he's never been there and probably will never come."
After telling the crowd that Webb was raising money in California with a "bunch of Hollywood movie moguls," Allen again referenced Sidarth, who was born and raised in Fairfax County.
"Lets give a welcome to Macaca, here. Welcome to America and the real world of Virginia," said Allen, who then began talking about the "war on terror."
(Hat-tip: Not Larry Sabato, via MyDD. Also check out lowkell's recommended diary.)
UPDATE: Atrios notes that "makak" (and variations) are recognized racial slurs aimed at North Africans. According to Wikipedia, Allen's mother is of European and Tunisian extraction.