Last year, Tibetan uprisings in Lhasa. Now, Uighur riots in Xinjiang. Quite obviously, pretending that racial tension doesn't exist isn't working.
The reasons why the Tibetans & Uighurs are angry are obvious: mass migration of Han into ethnic areas & them reaping bulk of benefits from economic development, suppression of culture & religious worship, Han control of political power, massive military presence & discrimination by the majority Han.
Unfortunately, by covering up the resentment and not addressing its root causes in the name of short term stability, the Chinese authorities are simply accumulating more long term hatred.
What the Chinese government should do is quite clear:
1. Get rid of the above root causes fueling Uighur dissatisfaction. When it concerns benefits and local political power, at least give the Uighurs an equal share of it.
2. Allow minorities more political posts with real power, not just symbolic NPC seats.
3. Increase Han understanding and acceptance of Uighur and Tibetan culture and practices. This can be easily done through national campaigns and patriotic education, both which China has much success with.
The future looks grim if we look at the former Soviet Union, which had similar but more brutal policies; these caused the many ethnic conflicts that sprung up right after the Soviet breakup. If the Chinese authorities continue on like this, Tibet and Xinjiang could one day become China's Chechnyas.