I suppose, modernists being modern, they would say that the world no longer has need for, nor room for, stories of that sort, exactly because they are exclusive, or 'racist'. I too think that if one takes Tolkien's legendarium in its entirety, there is in fact a great deal of compassion directed at those who have been misplaced and unjustly done by. From the Children of Hurin (my favourite of Tolkien's works) the Petty-Dwarves come to mind.
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