What regulation and red tape bring about is an expensive and discouraging system of bureaucracy. The biggest threat to major businesses is competition. Competition forces them to drive down their prices, offer better goods and services, and maintain a better employment staff. It's extremely expensive and far less guaranteed when you have other businesses attracting consumers of the same target market.

Regulations, for big business, are a god send. The price of labor goes up which makes it harder for small businesses to have a large staff. With a small staff, offering better goods and services becomes more difficult. Taxes, business licenses, property permits, and codes make it far more expensive just for a small business to operate. Larger businesses can afford to cut down on employment and pay more for permits, taxes, and regulations. Most small businesses find this hard. In a regulated market the dream of creating a small business from nothing is nothing more than a dream. Not only do you require investment for capital, you require expendable capital for government's sake. Basically, you can't be poor and start a business because government pretty much won't let you... unless, of course, you take out a major loan from a bank. Even if there was 0 interest, you'd still need to pay it back. If your business does not succeed, you owe the bank quite a lot of money. And not being able to pay that back... well, let's not get into what happens when a bunch of people can't pay back their loans... you get a movie by Michael Moore blaming it all on "Capitalism."

Of course, who do you think helps write these rules and regulations? This is the consequence of big government, special interests lobby Washington for an competitive advantage, but the politicians are too stupid to understand this.