Although I think U.S. communities have to work much harder on their economic development because of overseas competition that simply did not exist even fifteen years ago, we still have a valuable edge. This blog reprints an op-ed piece on some of the problems businesspeople in India face. Red tape, bureaucratic foot-dragging, costly permits, intrusive rent control, and antiquated labor laws make it very difficult to start a business in India.
By contrast, it is dead simple in the United States, and usually just involves paying a small fee to register your business with the local government. I don't think it is coincidental that the low barriers to starting a business track nicely with the fact that as many as 90% of new jobs in the U.S. are created by small businesses.