A commenter at Slate attempts to explain to Matthew Yglesias the answer to that journalist's question "Why does the census count me as Hispanic?"
Latinos/Hispanics are individuals whose descent comes from Latin American countries and Puerto Rico (an American Territory). The white ones, who are the descendants mostly of Spaniards, but also of other Europeans who emigrated to Latin America and Puerto Rico are not considered white by most Americans and are therefore discriminated against by the Anglo (non Hispanic white) majority.
The problem, then, is the all encompassing, prevalent, institutional, personal racism of the Anglo (non Latino white) majority.
Right. That's what caused the tragic lynching of Desi Arnaz in 1951 during the attempted filming of the first episode of the never-aired "I Love Lucy" series. As fans of Noel Ignatiev no doubt recall, a mob of furious whites in the studio audience, enraged at Arnaz laying his Spanish Cuban hands on the fair Lucille Ball, spontaneously tore the bandleader limb from limb. Historians sometimes speculate that if it weren't for the virulent white prejudice against Spanish Cubans miscegenating with whites, "I Love Lucy" might even have become something of a hit.