They were laughing because they identified with the dilemma. How human and honest of them. When people acknowledge their bias they are half way there to resolving it. Tea Party denies any racism in their ranks. They have further to go.
Most of what I've seen put out as "so-called" racism, was analogy and satire. But, I suppose those with thin-skins with grasp at any straw.
There have been instances of legitimate racism and at least one politician has been forced out because of it. The tea-party is a grassroots organization. Rallies are publicized and anybody can show up. Nutters included.
You can't defend every nutter that shows up to a left-wing rally carrying "Hitler or Nazi-ized" pictures of Bush or Cheney and neither can the right do much about such things. Conveniently, the President is black, so its pathetically easy to just throw the "racist" bomb at it.
I haven't seen any "real" racism in the tea-party (not that I've spent much time analyzing it, but I see what people purport to be racist) in what the "leaders" of that movement have put out there. I've heard most of those leaders say that they do not condone and would not tolerate racism that it's counter-productive, as it truly is. Since there is a dearth of evidence to the contrary, that's enough for me.