The original dollar paper bill was a promise to pay out gold, so to say a money warehouse receipt.
But in 1934/1971 the paper changed to not be redeemable for anything anymore, thus turning it into base money without counterparty risk, because there is no counterparty that can fail to honor the payout of gold.
Yes, I think the only sense in which fiat is really "backed by govt" is the promise that it will be accepted by govt as taxes.
Yup. Fiat gets its value because it’s the only way you can discharge your liabilities to the state. That’s what the Brits did in South Africa, imposing a ‘hut tax’ that could only be paid in British currency.
They don't even promise you that...
