I agree that thinking logically that this should be too dumb to even be taken seriously... But have you been to tumblr, man, have you seen that shit ;p
I've seen Tumblr make some weird attempts at trying as hard as possible to use gender-neutral pronouns, even in situations where it really doesn't make any sense (perhaps most amusingly when talking about fictional characters who are canonically male/female, and are addressed with gendered pronouns in their source material...), but, even in the most ludicrous examples I've seen, most people's pronoun of choice seems to be "they", or sometimes "xe", but never "it".
At any rate, I'm honestly not surprised that the program works the way it does. I can sort of see the logic behind it, and the intent isn't bad -- it's just horribly executed. Of course a program designed to pick up on key words and offer suggestions won't have anything to say about "Jews caused 9/11" because it's only designed to pick up on single words, and, if there was something in place designed to interpret sentences, there's no way it would work perfectly -- sort of like how Microsoft Word's grammar checker often flags sentences that we know have nothing wrong with them, or suggests changes that would actually make a sentence worse, or change the meaning of a sentence to something you don't want. At which point, it isn't so much about a skewed perception of political correctness as it is about computers just not being good at certain things that humans can much more easily pick up on.
Even the gender thing wouldn't be nearly as bad if the program had any concept of context, which it clearly doesn't (as evident when it tried to correct the "pop" in "pop culture"). Trying to use gender-neutral pronouns makes sense -- when you don't know the gender of the person in question. Problem is, the program can't tell when the gender of the subject isn't known; it's only programmed to pick up on any and all gendered words and suggest gender-neutral corrections, hence why it appears to have a ridiculous obsession with staying gender-neutral when there's no need for it.
I mean, don't get me wrong, I understand what a lot of you are saying about how ridiculous political correctness can be sometimes, but, let's keep in mind, this isn't about a
human stopping to 'correct' any and all references to the existence of gender while ignoring anything more obviously offensive -- it's just a computer, the political correctness of which only seems as ridiculous as it does because it can't be programmed to interpret language nearly as well as a human can. I feel like most real people -- even if they are the type to be highly PC -- would be just a
bit more rational in what they choose to go after -- at least in the sense that even people who
would try to erase any gendered word whatsoever would probably still recognize an obviously racist/anti-semetic/sexist/etc statement like in the example.
There definitely are some people out there who take political correctness too far, but I think it's a bit much to act as if a robot like this -- which is literally incapable of understanding the intent or meaning behind any sentences you give it, and only knows how to detect the words "he" and "she" completely removed from context -- is really representative of political correctness as a whole.
Edit: Though I will say, Jongo's right that it should've picked up on the use of an actual slur like "tranny", which wouldn't be difficult to program. Still, I'll attribute that to the programmers simply forgetting to put that word in -- as I'm sure any real person aiming to be PC would surely recognize that as a slur. Think of it like when spellcheck fails to recognize what you're absolutely certain is a real, correctly-spelled word. Programs like these certainly aren't perfect, even ignoring the subjectivity of political correctness. Ask a real person to look over your writing and correct anything that could potentially be offensive and, well, even if you find the most over-the-top SJW to do the job, they still won't be quite as ridiculous as the computer, because at least they'll manage to catch the obvious.