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Among countless individuals in the United States, the economic climate over the past five years has been difficult. Costs have skyrocketed while pay remains unchanged. Steep mortgage rates have made purchasing property a dismal prospect. The jobless rate has been creeping up.

Many Americans have reported they're putting off major life decisions, including raising children or moving to new employment, because of the instability. But for a select few of people, the recent half-decade couldn't have been more successful.

The Billionaire Boom

The wealth of the world's billionaires increased 54% in 2020, at the climax of the pandemic. And even amid all the market volatility, the stock market has only kept rising. This increase has primarily advantaged just a tiny percentage of Americans: 10% of the population holds 93% of stock market wealth.

As uneven as this distribution seems, it's the financial structure working as it is existing today.

"The wealthy have bought their jets, they've acquired their multiple houses and mansions, but now they're acquiring senators and media outlets," explained inequality researcher Chuck Collins. "We're now stepping into this other chapter of extreme wealth extraction where the wealthy are exploiting the system of inequality."

Mapping Economic Classes

To help others understand what exactly it means to be "wealthy" in the US, Collins adopts a concept from journalist Robert Frank who, in a 2007 book on the rich, envisioned the different levels of wealth as "Affluencia" villages: Affluent Town, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

To update the concept, Collins organizes these "economic communities" based on income levels:

• At the base level, Affluent Town, are the 10 million Americans who have a household income of at least $110,000 and an total assets of over $1.5m.
• The villages get more select as wealth goes up: Lower Richistan has 2.6 million households who have wealth between $6m and $13m.
• Middle Richistan has 1.3 million households who have assets worth an average of $37m.
• Upper Richistan, made up of 130,000 Americans (roughly the size of a small city) has between $60m to $1bn in wealth.

Collectively, the residents of these villages make up the top 10% of the wealth income distribution, about 14 million Americans altogether, though their lifestyles vary dramatically.

"You could be in Lower Richistan, and you're still traveling in the coach section of a commercial plane," Collins noted. "Whereas in Upper Richistan, you're flying in a private jet. That's a really different cultural experience. You fly private, you have no interest in the commercial aviation system. You don't care if the whole system fails – you're set."

Ultra-Wealth Impact

The highest hill in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's richest. The control that this group has greatly exceeds those who are simply affluent, let alone the ordinary person who doesn't live in "Richistan" at all.

But Collins thinks the activist mantra "end extreme wealth" misses the point and has a "hint of elimination" to it.

"It's the distinction between individual behaviors and a structure of regulations," Collins explained. "We should be concerned about an economic system that channels so much wealth upward to the billionaires."

Fortune Building Strategies

To understand how wealth at the billionaire level works, Collins separates it into four parts: getting the wealth, defending the wealth, policy control and maximum resource extraction.

When many Americans think about wealth, they usually think only about the first step, Collins said. People can create a limited sum of wealth through creating or operating a successful business, which could get them admission in Affluent Town.

But getting to Billionaireville requires significant resources and strategy in those next three steps. Collins describes what he calls the "wealth defense industry": the tax lawyers, accountants and wealth managers who use their skills to ensure that the super rich are being calculated about their taxes.

"Wealth defense professionals use a extensive selection of tools such as financial instruments, offshore bank accounts, anonymous shell companies, philanthropic entities and other methods to hold assets," he writes.

Government Power and Extreme Wealth Removal

To enhance a wealth defense strategy, a family needs policy assistance. Wealth of over $40m converts to political power, Collins says, and can be used to defend wealth and maintain expansion.

The final phase is a different kind of wealth accumulation, one that Collins calls "maximum taking" to describe how the wealthy have come to influence nearly every single part of an Americans' routine activities largely through capital management, which allows wealthy individuals to invest in private companies.

"Private equity is searching for those areas of the economy where they can squeeze things a little bit harder," Collins said. "One thing I don't think people comprehend is these billionaire private-equity funds are what happens when so much wealth is parked in so few hands, and they can kind of turn around and say, 'Where else can we generate returns out of the economy?' Healthcare? Great. Mobile home parks? These people can't go anywhere, [so] you can boost their expenses."

Actual Impacts

The consequences of this inequality go beyond the wealth getting wealthier. It's about people facing higher costs for their healthcare, rent and vet bills without seeing any significant salary growth. And Collins said the suffering and anger of this kind of society can lead to deep discontent.

"The most powerful wealthy elites understand people are being left behind [and] are economically suffering," Collins said, adding that conservative politicians have been good at connecting with a potent "false common-man appeal".

Political Reality

The contradiction, Collins points out in his book, is that political leaders have appointed a series of billionaires to government roles. Along with tech billionaires who had short yet influential roles overseeing substantial reductions to the federal workforce, other crucial appointments for commerce, treasury, education and the interior are also all billionaires.

This political landscape, along with help from legislative supporters, helped pass significant fiscal policies, which will make permanent tax cuts for the wealthy and corporations.

The Path Forward

While government groups continue to argue that immigration and bad trade agreements are the source of everyone's economic problems, "the question becomes: Will the opposing party, which has also been controlled by the billionaires and big money, be able to effectively tackle the underlying harms?" Collins said.

Progressive politicians, he argues, know what policies are needed to "reverse the updraft of wealth", including deep changes to the tax system, increasing the minimum wage and strengthening unions.

"It was so, so close, and the legislation really did reflect the will of the bulk of people who really want lawmakers to fix some of these urgent problems," Collins said. "Wealthy influence is not about building so much as preventing. It's easier to block than it is to make something substantial take place, but the historical precedent is there. We know what that looks like."

Collins is hopeful that there can be change, but said it would require continuous government action.

"It may be quickly that the pendulum swings back, and then it really is about maintaining a continuous public campaign to make progress on this profound imbalance we're living in," he said. "We can fix this. It is fixable."