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To numerous Americans, the economy over the last half-decade has been challenging. Prices have escalated while pay remains unchanged. Elevated mortgage rates have made purchasing property a grim prospect. The rate of unemployment has been gradually increasing.

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

Wealth Explosion

The assets of the world's billionaires grew 54% in 2020, at the height of the pandemic. And even throughout all the economic instability, the stock market has only kept rising. This expansion has mostly helped just a limited group of Americans: 10% of the population controls 93% of stock market wealth.

However unequal as this allocation seems, it's the economic framework working as it is currently designed.

"Affluent individuals have purchased their jets, they've purchased their multiple houses and mansions, but now they're buying senators and media outlets," stated wealth disparity expert Chuck Collins. "We're now moving into this other chapter of maximum resource removal where the wealthy are exploiting the system of inequality."

Mapping Economic Classes

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

To update the concept, Collins categorizes these "affluence districts" based on income levels:

• At the base level, Affluent Town, are the 10 million Americans who have a annual salary of at least $110,000 and an overall wealth 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.

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

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

The Billionaireville Effect

The summit in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's wealthiest. The power that this group has greatly exceeds those who are simply affluent, let alone the average American who doesn't inhabit "Richistan" at all.

But Collins thinks the progressive slogan "abolish billionaires" doesn't capture the real problem and has a "whiff of exterminism" to it.

"It's the difference between personal actions and a structure of regulations," Collins commented. "We should be concerned about an economic system that directs so much wealth upward to the billionaires."

The Four Pillars of Billionaire Wealth

To understand how wealth at the billionaire level works, Collins breaks it down into four parts: getting the wealth, securing fortune, government influence and extreme wealth removal.

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

But getting to Billionaireville requires serious investment and tactics 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 extensive selection of tools such as trusts, foreign deposits, undisclosed businesses, non-profit organizations and other vehicles to hold assets," he details.

Political Influence and Hyper-Extraction

To advance a wealth defense strategy, a family needs government backing. Wealth of over $40m translates to political power, Collins says, and can be used to defend wealth and protect its accumulation.

The final phase is a different kind of wealth accumulation, one that Collins calls "hyper extraction" to describe how the wealthy have come to influence nearly every single part of an Americans' routine activities largely through investment firms, which allows wealthy individuals to support private companies.

"Private equity is looking for those corners of the economy where they can extract value a little bit harder," Collins said. "One thing I don't think people realize 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 increase their costs."

Tangible Effects

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 substantial income improvement. And Collins said the suffering and anger of this kind of society can lead to profound dissatisfaction.

"The most powerful affluent rulers understand people are being marginalized [and] are financially struggling," Collins said, adding that right-leaning leaders have been good at tapping into a potent "fake grassroots movement".

Government Truth

The irony, Collins points out in his book, is that government officials have appointed a succession of billionaires to government roles. Along with affluent innovators who had brief but powerful roles overseeing massive cuts 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 congressional allies, helped pass significant fiscal policies, which will make permanent tax cuts for the wealthy and corporations.

Potential Changes

While government groups continue to argue that immigration and unfavorable commercial treaties are the source of everyone's economic problems, "the challenge is: Will the alternative political group, which has also been controlled by the billionaires and big money, be able to meaningfully address the underlying harms?" Collins said.

Progressive politicians, he argues, know what policies are needed to "alter economic flow", including significant reforms to the tax system, increasing the minimum wage and empowering worker groups.

"It was so, so close, and the bill really did represent the will of the most of people who really want lawmakers to fix some of these pressing issues," Collins said. "Oligarchic power is not about creating so much as stopping. It's easier to block than it is to make something substantial take place, but the muscle memory is there. We know what that looks like."

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

"It may be before we know it that the tide turns, and then it really is about preserving a ongoing grassroots effort to make progress on this profound imbalance we're living in," he said. "We can fix this. It is fixable."