First off, here is the term as defined by dictionary.reference.com:
"Anthropology. of, pertaining to, or characteristic of one of the traditional racial divisions of humankind, marked by fair to dark skin, straight to tightly curled hair, and light to very dark eyes, and originally inhabiting Europe, parts of North Africa, western Asia, and India: no longer in technical use."
The above definition, and this one on wiki which corroborates it, would mean that I would, technically, be considered Caucasian. As would Morrocans, Algerians, Iranians, Iraqis, Pakistanis, Indians, and many other peoples of colour. It's obvious to me that most of the references I've seen to "Caucasian" are not intended to include myself, or any other people of colour. My guess is that in these instances, the writer actually means to say "white folks". This seems to be a very North American usage of the term. If you read the above-linked wiki entry, and any other info on the topic, really, you'll get a sense for why the term "Caucasian" is problematic, and how it has been rooted in racist and racially-motivated designations (that have nothing to do with reality).
The term irks me, in particular, because I am always reminded of the United States v. Bhagat Singh Thind case whenever I see/hear it. As anyone who has ever taken an Asian Studies class probably knows, this was the case of Bhagat Singh Thind, a Punjabi Sikh man, who argued with the US courts that, because he was technically Caucasian and Aryan, he was entitled to become a naturalized citizen of the US, according to the 1790 statute governing naturalization.*
As you might imagine, this threw the courts in a tizzy and all kinds of new findings were brought about, and stuff was re-worded to make it abundantly clear that when the word "Caucasian" was used in the 1790 statute, the writers WERE NOT referring to brown people. According to wiki, "The Court found that the authors of the 1790 statute probably ascribed to 'the Adamite theory of creation' and understood 'white people' in its popular, and not scientific, sense."
After the Thind decision, not only was he not allowed to become a naturalized citizen, all Indian-Americans who had become citizens before that point had their status retroactively revoked. They were stripped of their land, rights, and citizenship. More than half of the Indian-Americans, who had settled on US soil as land-owning citizens, at that point left the US.
So, the term is a loaded one, and dotted with racial/racist history. I know many folks use the term "Caucasian" to mean white people, particularly here in the US. I don't know if it's supposed to be more polite than saying "white" or if it somehow sounds more like a technical (therefore, more valid?) term, akin to "African-American" or "Asian-American" (but then why not "European-American"?), but it is one that I, personally, cringe at every single time I read it or hear it.
*The complexities of why he should choose to argue this at all is for another post.
