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For many US citizens, the financial landscape over the recent five-year span has been challenging. Prices have soared while pay remains flat. Elevated mortgage rates have made purchasing property a grim prospect. The unemployment rate has been slowly rising.

Many Americans have reported they're delaying major life decisions, including starting a family or changing careers, because of economic uncertainty. But for a select few of people, the recent half-decade couldn't have been any better.

The Billionaire Boom

The wealth 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 continued to grow. This expansion has mostly helped just a limited group of Americans: 10% of the population controls 93% of stock market wealth.

Despite the imbalance as this division seems, it's the system working as it is existing today.

"Rich elites have acquired their jets, they've purchased their multiple houses and mansions, but now they're buying senators and media outlets," explained wealth disparity expert Chuck Collins. "We're now moving into this other chapter of hyper-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 adopts a concept from journalist Robert Frank who, in a 2007 book on the rich, conceptualized the different levels of wealth as "Wealthville" villages: Wealth Borough, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

To modernize the concept, Collins classifies these "economic communities" 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 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 constitute 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 traveling 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 distinct lifestyle. You fly private, you have no investment 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 far surpasses those who are simply affluent, let alone the ordinary person who doesn't live in "Richistan" at all.

But Collins thinks the political catchphrase "billionaires shouldn't exist" misses the point and has a "hint of elimination" to it.

"It's the difference between personal actions and a framework of policies," Collins explained. "We should be concerned about an economic system that channels 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 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 establishing or managing a successful business, which could get them admission in Affluent Town.

But getting to Billionaireville requires significant resources and planning in those next three steps. Collins describes what he calls the "wealth defense industry": 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 legal entities, offshore bank accounts, secret corporations, charitable foundations and other vehicles to hold assets," he writes.

Political Influence and Hyper-Extraction

To further a wealth defense strategy, a family needs government backing. Wealth of over $40m becomes political power, Collins says, and can be used to protect assets and maintain expansion.

The ultimate step 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' daily existence largely through investment firms, which allows wealthy individuals to fund 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 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 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 results of this inequality go beyond the wealth getting wealthier. It's about people spending additional funds for their healthcare, rent and vet bills without seeing any substantial income improvement. 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 marginalized [and] are monetarily hurting," Collins said, adding that conservative politicians have been good at connecting with a potent "phony populism".

Policy Situation

The irony, Collins points out in his book, is that government officials have appointed a string of billionaires to administrative posts. Along with affluent innovators who had brief but powerful roles overseeing substantial reductions to the federal workforce, other key positions 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.

Potential Changes

While government groups continue to argue that foreign entry and bad trade agreements are the source of everyone's economic problems, "the question becomes: Will the opposing party, which has also been influenced 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 "alter economic flow", including substantial modifications 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 bulk of people who really want lawmakers to fix some of these critical challenges," Collins said. "Oligarchic power is not about creating so much as preventing. It's easier to block than it is to make something meaningful happen, but the institutional knowledge is there. We know what that looks like."

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

"It may be quickly that the balance shifts, and then it really is about sustaining a sustained really popular movement to make progress on this severe disparity we're living in," he said. "We can solve this. It is fixable."