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For many Americans, the economic climate over the last half-decade has been difficult. Costs have skyrocketed while salaries remains flat. High mortgage rates have made purchasing property a grim prospect. The rate of unemployment has been creeping up.

The majority of individuals have stated they're putting off major life decisions, including starting a family or changing careers, because of economic uncertainty. But for a very small group of people, the past five-year period couldn't have been any better.

The Billionaire Boom

The fortune of the world's billionaires increased 54% in 2020, at the height of the pandemic. And even during all the financial uncertainty, the stock market has only persisted in expanding. This growth has largely benefited just a limited group 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 currently designed.

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

Mapping Economic Classes

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

To contemporize the concept, Collins classifies these "economic communities" based on income levels:

• At the lowest tier, 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 exclusive 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.

Altogether, 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 flying in the coach section of a commercial plane," Collins explained. "Whereas in Upper Richistan, you're flying in a private jet. That's a really different cultural experience. You fly private, you have no investment in the commercial aviation system. You don't care if the whole system fails – you're set."

Ultra-Wealth Impact

The summit in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's richest. The power that this group has substantially outweighs those who are simply well-off, let alone the ordinary person who doesn't live in "Richistan" at all.

But Collins thinks the progressive slogan "abolish billionaires" misses the point and has a "suggestion of eradication" to it.

"It's the separation between individual behaviors and a framework of policies," Collins commented. "We should be worried about an economic system that funnels so much wealth upward to the billionaires."

Wealth Accumulation Mechanisms

To understand how wealth at the billionaire level works, Collins breaks it down into four parts: accumulating assets, securing fortune, policy control and maximum resource extraction.

When many Americans think about wealth, they usually think solely about the first step, Collins said. People can create a modest amount of wealth through establishing or managing a successful business, which could get them membership in Affluent Town.

But getting to Billionaireville requires serious investment and planning in those next three steps. Collins describes what he calls the "fortune security field": the tax lawyers, accountants and wealth managers who use their expertise to ensure that the super rich are being calculated about their taxes.

"Wealth defense professionals use a wide variety of tools such as trusts, foreign deposits, undisclosed businesses, charitable foundations and other methods to hold assets," he explains.

Government Power and Extreme Wealth Removal

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

The last stage is a different kind of wealth accumulation, one that Collins calls "extreme removal" to describe how the wealthy have come to influence nearly every single part of an Americans' everyday life largely through investment firms, which allows wealthy individuals to fund private companies.

"Private equity is seeking those corners 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 essentially pivot and say, 'Where else can we extract profits out of the economy?' Healthcare? Great. Mobile home parks? These people can't go anywhere, [so] you can raise their rents."

Tangible Effects

The effects of this inequality go beyond the wealth getting wealthier. It's about people paying more for their healthcare, rent and vet bills without seeing any substantial income improvement. And Collins said the hardship and discontent of this kind of society can lead to deep discontent.

"The most powerful oligarchs understand people are being left behind [and] are financially struggling," Collins said, adding that Republicans have been good at accessing a potent "false common-man appeal".

Government Truth

The irony, Collins points out in his book, is that government officials have appointed a succession of billionaires to cabinet positions. Along with affluent innovators who had brief but powerful roles overseeing massive cuts to the federal workforce, other important roles 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 lasting reductions for the wealthy and corporations.

Future Solutions

While political parties continue to argue that border policies and bad trade agreements are the source of everyone's economic problems, "the challenge is: 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.

Liberal leaders, he argues, know what policies are needed to "change wealth distribution", including significant reforms to the tax system, boosting the minimum wage and strengthening unions.

"It was so, so close, and the legislation really did embody the will of the most of people who really want lawmakers to address some of these pressing issues," Collins said. "Oligarchic power is not about developing so much as stopping. It's easier to block than it is to make something significant occur, but the historical precedent is there. We know what that looks like."

Collins is positive that there can be change, but said it would require ongoing legislative effort.

"It may be sooner than expected that the balance shifts, and then it really is about preserving a continuous public campaign to make progress on this extreme inequality we're living in," he said. "We can address this. It is fixable."