why do some foreigners still think LAOWAI is a derogatory term for ''foreigner''

[the sane and rational]

instead of an intimate or? respectful term like LAOSHI(teacher) or LAOZI(famous philosopher)? even after they lived in china for many years they still don't understand?

why do they have so much misunderstanding/misconception about so many things? e.g. chinese eating dogs and cats , it's so absurd!