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Among countless Americans, the economy over the recent five-year span has been tough. Prices have skyrocketed while pay remains stagnant. Elevated mortgage rates have made buying a home a grim prospect. The rate of unemployment has been slowly rising.

Most people have indicated they're putting off major life decisions, including starting a family or switching jobs, because of the instability. But for a tiny fraction of people, the past five-year period couldn't have been more successful.

Wealth Explosion

The wealth of the world's billionaires grew 54% in 2020, at the peak of the pandemic. And even throughout all the financial uncertainty, the stock market has only continued to grow. This increase has primarily advantaged just a small number of Americans: 10% of the population holds 93% of stock market wealth.

However unequal as this division seems, it's the economic framework working as it is existing today.

"Rich elites have purchased their jets, they've bought their multiple houses and mansions, but now they're securing senators and media outlets," commented wealth disparity expert Chuck Collins. "We're now stepping into this other chapter of hyper-extraction where the wealthy are taking advantage of the system of inequality."

Analyzing Income Brackets

To help others comprehend what exactly it means to be "affluent" in the US, Collins adopts a concept from journalist Robert Frank who, in a 2007 book on the rich, imagined 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 "wealth villages" based on income levels:

• At the base level, Affluent Town, are the 10 million Americans who have a family earnings of at least $110,000 and an overall wealth of over $1.5m.
• The villages get more restricted 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 comprise the top 10% of the wealth income distribution, about 14 million Americans altogether, though their circumstances 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 using 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 shuts down – you're set."

The Billionaireville Effect

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 influence that this group has greatly exceeds those who are simply wealthy, let alone the average American who doesn't live in "Richistan" at all.

But Collins thinks the activist mantra "abolish billionaires" fails to address the core issue and has a "suggestion of eradication" to it.

"It's the distinction between personal actions and a framework of policies," Collins said. "We should be focused on 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 separates it into four parts: accumulating assets, protecting assets, policy control and extreme wealth removal.

When many Americans think about wealth, they usually think solely 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 residency in Affluent Town.

But getting to Billionaireville requires serious investment and strategy 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 legal entities, foreign deposits, undisclosed businesses, philanthropic entities and other vehicles to hold assets," he explains.

Political Influence and Hyper-Extraction

To further a wealth defense strategy, a family needs policy assistance. Wealth of over $40m translates to political power, Collins says, and can be used to protect assets and protect its accumulation.

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

"Private equity is searching for those corners of the economy where they can extract value 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 stored in so few hands, and they can kind of turn around and say, 'Where else can we squeeze money out of the economy?' Healthcare? Great. Mobile home parks? These people can't go anywhere, [so] you can increase their costs."

The Real Consequences

The results 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 pain and frustration of this kind of society can lead to profound dissatisfaction.

"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 accessing a potent "fake grassroots movement".

Political Reality

The contradiction, Collins points out in his book, is that elected representatives have appointed a series of billionaires to cabinet positions. Along with tech billionaires who had temporary but significant 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 enduring decreases for the wealthy and corporations.

The Path Forward

While government groups continue to argue that foreign entry and unfavorable commercial treaties are the source of everyone's economic problems, "the question becomes: Will the other major party, which has also been influenced by the billionaires and big money, be able to seriously confront the underlying harms?" Collins said.

Progressive politicians, he argues, know what policies are needed to "change wealth distribution", including deep changes to the tax system, raising the minimum wage and strengthening unions.

"It was so, so close, and the bill really did reflect the will of the most of people who really want lawmakers to fix some of these critical challenges," Collins said. "Elite control is not about building so much as preventing. It's easier to block than it is to make something meaningful happen, 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 quickly that the tide turns, and then it really is about maintaining a ongoing grassroots effort to make progress on this extreme inequality we're living in," he said. "We can address this. It is solvable."