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To numerous US citizens, the economic climate over the past five years has been challenging. Expenses have skyrocketed while wages remains flat. High mortgage rates have made homeownership a bleak prospect. The rate of unemployment has been slowly rising.

Many Americans have stated they're putting off major life decisions, including having kids or changing careers, because of the instability. But for a select few of people, the past five-year period couldn't have been more prosperous.

Fortune Expansion

The wealth of the world's billionaires increased 54% in 2020, at the height of the pandemic. And even throughout all the financial uncertainty, the stock market has only kept rising. This expansion has largely benefited just a small number of Americans: 10% of the population controls 93% of stock market wealth.

As uneven as this distribution seems, it's the system working as it is currently designed.

"Affluent individuals have bought their jets, they've acquired their multiple houses and mansions, but now they're securing senators and media outlets," stated inequality researcher Chuck Collins. "We're now moving into this other chapter of maximum resource removal where the wealthy are preying on the system of inequality."

Analyzing Income Brackets

To help others grasp 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, imagined the different levels of wealth as "Richistan" villages: Wealth Borough, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

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

• At the lowest tier, Affluent Town, are the 10 million Americans who have a family earnings of at least $110,000 and an net worth 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 circumstances vary dramatically.

"You could be in Lower Richistan, and you're still sitting in the coach section of a commercial plane," Collins said. "Whereas in Upper Richistan, you're traveling via a private jet. That's a really separate reality. 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 peak in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's most affluent. The control that this group has substantially outweighs those who are simply wealthy, let alone the typical citizen who doesn't reside in "Richistan" at all.

But Collins thinks the political catchphrase "abolish billionaires" fails to address the core issue and has a "hint of elimination" to it.

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

Fortune Building Strategies

To understand how wealth at the billionaire level works, Collins divides it into four parts: getting the wealth, protecting assets, political capture and maximum resource extraction.

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 tactics 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 deliberate about their taxes.

"Wealth defense professionals use a broad range of tools such as trusts, offshore bank accounts, 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 government backing. Wealth of over $40m translates to political power, Collins says, and can be used to secure fortune and maintain expansion.

The last stage 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' 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 parked in so few hands, and they can basically shift 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."

Actual Impacts

The effects 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 profound dissatisfaction.

"The most powerful oligarchs understand people are being excluded [and] are economically suffering," Collins said, adding that conservative politicians have been good at accessing a potent "fake grassroots movement".

Government Truth

The contradiction, Collins points out in his book, is that elected representatives have appointed a string of billionaires to cabinet positions. Along with tech billionaires who had short yet influential roles overseeing massive cuts to the federal workforce, other important roles for commerce, treasury, education and the interior are also all billionaires.

This government structure, along with help from legislative supporters, helped pass significant fiscal policies, which will make lasting reductions for the wealthy and corporations.

The Path Forward

While legislative bodies continue to argue that foreign entry and bad trade agreements are the source of everyone's economic problems, "the challenge is: Will the alternative political group, which has also been influenced by the billionaires and big money, be able to seriously confront the underlying harms?" Collins said.

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

"It was so, so close, and the law really did represent the will of the majority of people who really want lawmakers to fix some of these critical challenges," 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 ongoing legislative effort.

"It may be before we know it that the tide turns, 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 solve this. It is fixable."