I disagree with the term "African American" for the simple fact that it implies that all "blacks" have some sort of spiritual, and/or genetic, and/or cultural "obligation" to Africa. Its BS "Race = Continent" crap. I'm sure you have your own ideas about things, but I see things in terms of nation....not race, ethnic group, or any other label.If you agree with some form of pan-africanism however, "African American" is probably quite appropriate.
I think your walking a dangerous line with your "why not refer to races by their color?" thought though.....I'd say why not refer to individuals as their names....and any other "descriptive" terms that apply need to be said with phenotype, not race, in mind.
However, there is certainly some cases where one can and should be offended by a label....a reactionary might say "Why can't they just be happy with the term negro?".......
For the record, the whole "Black", "White", "Yellow", and "Brown" system is just as outdated to me as "negroid", "caucasoid" etc etc........however, unlike the former words, the latter can be used in a non-psuedo scientific way, so I will use them before something else.
"Criticism must be sharp… If you do not do things well, I won't be satisfied with it, and if I offend you, I offend you, and that's that. To be afraid of offending people is nothing more than being afraid of losing votes and being afraid of having difficult relations in one's work with one's co-workers. Will I starve if you don't vote for me? Nothing of the sort. Actually, relations will be smoother if you speak out and put the problem clearly on the table… A bull has two horns because it has to fight. One purpose is for defense and another purpose is for offence. I have often asked comrades, Have you grown any horns on your head?' You comrades can feel your heads and see… I think that it's better to grow two horns,' because that conforms to Marxism" - Mao