(2) the term “terrorism” means premeditated, politically motivated violence perpetrated against noncombatant targets by subnational groups or clandestine agents; 22 USC § 2656f - Annual country reports on terrorism
I'd expand that slightly to include the same kind of violence, by the same means, for ideological reasons, such as religion. Beyond that, though, any use of the word is wrong, and has more to do with manipulating opinion than it does with trying to define or explain something.
Blowing up an abortion clinic for religious reasons, for instance could be considered terrorism. Blowing one up for the purpose of extorting money from others is extortion.
In the context of the bombing in Boston last Monday, whether or not it's terrorism depends on the motivations of the bombers, not on whether or not people were frightened by it. That is why I've avoided using the term, and will continue to until such time as the people responsible have been found and tried for what they've done, or until they admit what they've done and explain why in some other circumstance that doesn't involve duress.
Any opinions expressed using the word "terrorism" should, I think, be viewed in that context. Words mean particular things. When people use those words in other ways, then their opinions should be viewed more skeptically.
(h/t to Micah Zenko of Atlantic magazine for that USC link.)
NOTE 1: I'd advise any so-called progressives who think this is exclusively a Republican view of our rights (including the author of that link) to read Glenn Greenwald's analysis of that issue. Graham's opinions on due process for so-called "terrorists" has been the Obama Administration's since at least 2010.
UPDATE (Apr. 22): Glenn Greenwald provides another explanation for what is required to call acts such as the Boston Marathon bombings terrorism, responding to Andrew Sullivan's fatuous claim that the Tsarnaev brothers simply must have been terrorists because they're Muslims:
The only evidence he can point to shows that the older brother, Tamerlan, embraced a radical version of Islam, something I already noted. But - rather obviously - to prove that someone who commits violence is Muslim is not the same as proving that Islam was the prime motive for the violence (just as the aggressive attack by devout evangelical George Bush on Iraq was not proof of a rejuvenation of the Christian crusades, the attack by Timothy McVeigh was not proof of IRA violence, and the mass murder spree by homosexual Andrew Cunanan was not evidence that homosexuality motivated the violence). Islam or some related political ideology may have been the motive driving Tamerlan, as I acknowledge, but it also may not have. You have to produce evidence showing motive. You can't just assert it and demand that everyone accept it on faith. Specifically, to claim this is terrorism (in a way that those other incidents of mass murder were not), you have to identify the "political or social objective" the violence was intended to promote: what was that political or social objective here? Andrew doesn't have the slightest idea.
Why is Boston 'terrorism' but not Aurora, Sandy Hook, Tucson and Columbine?
This isn't even a question of law - it's a question of basic logic. No one can know what's going on in someone's mind based on a few, and possibly cherry-picked, facts about that person's life. Did the Tsarnaev brothers leave writings about why they did this? There are none that I've heard of. Has anyone who knew them been quoted as saying they'd told him that they were on a jihad? As I wrote in an unrelated incident, there are often alternative explanations when you look into a person's life.
And yes, plenty of people, as they always do, will talk about how if something quacks like a duck it simply must be a duck. These people are mindless, and, as with people who don't bother to use the word "terrorism" properly despite its obvious power, they are people who shouldn't be taken seriously in this context.
UPDATE (May 13): Changed the third paragraph to end "is extortion." It originally said "is a crime", which is actually not a distinction. Both terrorism and extortion are crimes.