A unit of exchange. I think you would call it fiat money.
Well, that's correct, so far as it goes...but it wasn't quite what I was looking for.
You see, you can say (for example) that one degree Celsius is "a unit of temperature," but to be specific you say that one degree Celsius is "one one-hundredth of the difference in temperature between the freezing point of water and the boiling point of water at sea level." Likewise, one gram is the weight of a cubic centimeter of water, and one milliliter is the volume of that quantity of water. A liter of water is the volume of water that weighs one kilogram. The units are defined in terms of measurable quantities of real materials with fixed properties.
In other words, the units used to measure things are defined in terms that allow us to quickly understand their meaning. When we were on the gold standard, the dollar was also like this. Instead of saying that a dollar was "a unit of fiat currency," you could say that it was "a unit of currency equal in value to X weight of gold."
Since we're off the gold standard, that's no longer a valid definition...X isn't fixed any more. So what's a dollar? It used to be influenced, if not controlled, by the relative abundance or scarcity of the physical paper notes that represent dollars. Now, however, we don't even remotely have enough paper notes to represent all the dollar transactions that occur in a given day. A number in my bank's "ledger" goes down, a number in my utility company's "books" goes up, and no paper notes are involved.
So what's a dollar again? How is it defined? What determines its value?
unit of exchange. I think you would call it fiat money
Well...its not what it used to be...when the money supply is increased as rapidly as the supply of US dollars is...its causes inflation...which is just another tax...this one on savings...to support out-of-control government spending
That's why the most important argument that the Federalists made in support of the US Constitution (and the argument the Anti-Federalists could not really counter) was that the Constitution would rid the country of the scourge of worthless paper money by giving the feds the power to coin money (precious metal money) and prohibiting the states from "emitting bills of credit" (paper or fiat currency)
Of course...hidden taxes like inflation aren't recognized by most Americans and the Constitution is now ignored as a relic or an inconvenience...even by so-called "conservatives"