I'm not sure if it's fair to say that the Imperials are "racist' at this time (4th Age). Imperialism (in our own world) largely consisted of the assumption of cultural superiority over others. This manifested in various ways. European colonists enslaved and killed aboriginals (yes, even the "benevolent" British Empire. Not so benevolent to the colored people). Soviet Union and the American empire used gunboat diplomacy to gain economic benefits around the world. China is currently in the process of trying to enlargen their sphere via military incursions. And these were/are largely justified by "we're superior to others". By the 4th Age in Skyrim, the Empire is essentially broken. The Empire is gone. They've lost their cultural identity. They've lost the ancient Imperial bloodline, they've denied the divinity of their founder (which formed one of the core belief of the Empire), they're allowing agents of foreign government to enforce religious restrictions against one of their most ancient heritage, they've lost the common bonds of unity between different provinces, etc etc. Imperials really have nothing left to say "we're Imperials!" other than name tags on their uniform. Also, I'm not sure if it's fair to say Ulfric is "racist" anymore than an average governemnt leader of a developed world (in our world). When there is a large influx of a refugee population (which tends to be poor, relatively uneducated, and without common root / customs), they tend to become beds for crime and social problems, not to mention the economic strain of having to deal with caring for the refugees. That's an headache for any government official. Now, his followers are certainly racist. But Ulfric himself? I'm not sure just how much of his "racism" arises from administrative needs (and the needs to gain the loyalty of his followers) and how much from his actual belief.