Hold on, since when is preserving "your effectiveness" in a debate something that anyone cares about in the real world? You should just say, "I find that word offensive" or "please call me X instead." A polite person won't keep pushing or debate you after that. It makes it clear that you are asking them to do something to make you feel comfortable.

Also, "we don't do that here" doesn't mean "not right now" it means "never, or we won't let you into the club." The phrasing of the sentence implicitly diffuses responsibility among the entire group, and marks the other person in the conversation as an outsider.

I'm not you, but I wouldn't want to say that to an employee. I want them to feel comfortable, too.