As long as we recognize these aspirations for a perfect world as the unlikely fantasy that they are, a potential that we can grow into, they are harmless. It’s only when people adopt them as some reasonable short-term goal and forego reality that they become problematic. We, especially in the US, are not going to ditch our monetary system any time soon.
The concept of money being a creation of the state is quite accurate. Money begins with taxation in some currency that the state has a monopoly in issuing. Once a tax is levied and payable only in the state’s currency, the entire population becomes effectively unemployed until individuals can satisfy their tax obligation to avoid penalties.
This allows the state to provision itself without restraint from revenue sources and supplies the economy with a denomination for its trade and commerce which draws resources into the economy to be available to the state. The state only has to spend more into the economy than it demands back in taxes (deficit) to enable this adoption of its currency. While precious metals were the standard for trade between nation states because of their ability to be easily re-minted into the currency of their new owners, I highly doubt that early domestic state currencies were any more than script whose value was derived from the ability of the rulers to effectively collect taxation.
While such script was valuable to taxpayers, it has absolutely no value to the state which maintained a monopoly on its issuance. Taxation gives value to the currency in the economy and controls the general supply of currency, but has no intrinsic value to a government that can make as much of it as it wishes. This negates the concept of taxing for revenue and allows the state to fashion its economy via currency distribution, not its real or potential income.
Once we understand this we will see much better distribution and governments much better able to provide for the needs of their citizens by spending and taxation that creates a better balance of wealth. It is only when we view money as a “thing” that we create through our commerce and the state “uses” in competition with us that we forfeit the ability of the government to properly manage the economy. In such a confused vision of the currency, the state will always be constrained needlessly and vilified for waste when it spends on the common good if the citizens see such spending as being financed by their tax payments.