The Gross Domestic Product (GDP), which measures the dollar value of finished goods and services produced by an economy during a given period, serves as the chief indicator of the economic well-being of the United States. The GDP assumes that the economic significance of goods and services lies solely in their price, and that these goods and services add to the national well-being, not because of any intrinsic value they may possess, but simply because they were produced and bought. Additionally, only those goods and services involved in monetary transactions are included in the GDP. Thus, the GDP ignores the economic utility of such things as a clean environment and cohesive families and communities. It is therefore not merely coincidental, since national policies in capitalist and non-capitalist countries alike are dependent on indicators such as the GDP, that both the environment and the social structure have been eroded in recent decades. Not only does the GDP mask this erosion, it can actually portray it as an economic gain: an oil spill off a coastal region "adds" to the GDP because it generates commercial activity. In short, the nation's central measure of economic well-being works like a calculating machine that adds but cannot subtract.


The passage implies that national policies that rely heavily on economic indicators such as the GDP tend to


become increasingly capitalistic in nature

disregard the economic importance of environmental and social factors that do not involve monetary transactions

overestimate the amount of commercial activity generated by environmental disasters

overestimate the economic significance of cohesive families and communities

assume that the economic significance of goods and services does not lie solely in the price of those goods and services

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