Dwarves use sturdy, well-crafted axes and hammers. Elves use thin, elegant blades and bows. Halflings are nimble and sneaky. Half-orcs are strong, savage, and not so bright.
We all know these things, but how important is it that they affect the actual mechanics of the game? Most players tend to think of class as the biggest defining aspect of a character. Whether this is true or not, how important is race? How important is it that an elf fighter be significantly mechanically different from a human fighter or dwarf fighter? Racial differences add a lot of flavor to the game, and they can provide story hooks to flesh out characters.
Even if those differences exist at 1st level, however, the distinctions can fade over time. In other words, the things that go into making a dwarf different from an elf are more significant to low-level characters than to high-level ones. The game could work to ensure that the distinctions always remain relevant.
On the other hand, lots of racial abilities add complication. Adding in more abilities as characters gain levels, or offering abilities that scale with level, can make things more complex. A character sheet can seem cluttered with skill bonuses and minor special abilities based on race. Is it worth it?
