I don't feel like babysitting my niece anymore.
Do you have a reason why?
I would rather spend time with my friends.
I get not wanting to miss out on fun times with friends, but I'm sure your sibling is counting on you to watch your niece. It's important to do things to help out your siblings when you can. If you need help someday they'll be unwilling to help you if you never help them.
I'm not going to babysit that retard.
You should watch her. You can have a really special bond with her. Your friends will understand that you have prior commitments.