The Red Tape Conundrum

(Credit: Illustration by Timothy Goodman; Photograph by Brian Henn)

It may well be the biggest bogeyman in business—bigger, perhaps, than even taxes: We’re talking, of course, about red tape. The idea that burdensome and overly complicated government regulation is strangling growth is almost as old as commerce itself. But right now the hue and cry from the business community is louder than at just about any time in recent memory. Concern about regulation is soaring among executives. In a recent survey by Deloitte, North American chief financial officers named new, burdensome regulation as the No. 2 threat to their business, behind only the possibility of a recession. When the National Federation of Independent Business, which represents 325,000 small U.S. companies, conducted its quadrennial survey earlier this year, its members identified “unreasonable government regulations” as the second-biggest threat, after rising health care costs. And for a fourth year in a row, the CEOs surveyed by the Business Roundtable for its annual economic outlook cited regulation as the top cost pressure facing their companies. Red tape has emerged as a major talking point in the presidential campaign—with each candidate approaching the topic in characteristic fashion. Hillary Clinton has promised to be the “small-business President” and has wonkishly outlined plans to cut red tape by streamlining the startup process for entrepreneurs and expanding access to credit through community banks and credit unions.

For learn more about red tape, watch this Fortune video.