By Representative Eric Cantor
Small businesses are caught in a riptide of red tape. The overwhelming onslaught of rules and regulations coming from Washington is making it nearly impossible to start or stay in business, let alone grow, succeed, and create jobs.
Since the president took office, his administration has had under review more than 400 regulations that cost the economy $100 million or more. According to the Small Business Administration, small businesses are facing annual regulatory costs of up to $10,000 per employee.
Keeping up with cumbersome paperwork and compliance requirements cost entrepreneurs time and money, and that means less capital for hiring new employees. This is making it harder for our nation's small businessmen and women, who we are counting on to sustain our local economies and create jobs.
Every extra rule, regulation, or requirement where the government imposes a cost on the economy disrupts and distracts small business owners from growing their business. The last thing the economy needs right now are more roadblocks. We need to cut through the red tape to create an environment of certainty to promote innovation and unleash economic growth.
The president of Virginia's Valley Bank in Roanoke tells me that new rules and regulations are flooding community banks almost daily. "Community banks find themselves so internally-focused on compliance related activities that they cannot attend to the job of extending credit," he says, adding that it is hurting hopes for a sustained economic recovery. We need community banks focused on growing our local economies not wading in an unnecessary pool of red tape.
The owner of a trucking company in Ashland, Virginia, in my district, says that constant regulatory changes by the Environmental Protection Agency have caused the prices for his operation to go up. These rising costs have made it more difficult to operate today and even harder to plan for future.
Excessive regulations aren't only impacting small businessmen and women. Major manufacturers like Richmond, Va.-based MeadWestvaco are facing a barrage of regulations from the EPA. The company's senior expert on environmental regulations testified before a congressional panel that, "The current wave of regulations is unsustainable. Living with such an uncertain regulatory environment not only costs current jobs, but also prevents new jobs from being created."
Since day one, House Republicans have been focused on creating a better environment for job growth. The House voted this week on the Red Tape Reduction and Small Business Job Creation Act to begin to roll back unnecessary red tape, giving businesses of all sizes more certainty and opportunity to grow and create jobs.
To end the ongoing overreach, our legislation would freeze costly new regulations until national unemployment drops to 6 percent or lower. To ensure smarter regulations are implemented moving forward, we would require all agencies to perform thorough cost-benefit analyses of proposed regulations. The bill would also increase transparency for federal agencies that have been operating outside the purview of regulatory review, such as the National Labor Relations Board. Further, our bill would streamline the federal permitting process since energy and construction projects across the country are being delayed or stopped entirely due, in large part, to a broken permitting process.
If we are to grow our economy and get more people back to work, Washington must get out of the way. Federal regulation must become smarter and less harmful to our economy. We know small businesses are built because of the men and women who take risks, work hard, and invest capital in new ideas. At a time when millions of Americans are struggling to find jobs, we must make it easier for these small business owners to grow and expand. Reducing red tape will empower our small businesses to start hiring again, create more jobs, and ensure a thriving economy for the future.