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Among countless US citizens, the financial landscape over the recent five-year span has been tough. Costs have escalated while salaries remains unchanged. Steep mortgage rates have made purchasing property a grim prospect. The unemployment rate has been slowly rising.

Most people have stated they're delaying major life decisions, including having kids or switching jobs, because of the instability. But for a tiny fraction of people, the recent half-decade couldn't have been more successful.

Fortune Expansion

The wealth of the world's billionaires expanded 54% in 2020, at the height of the pandemic. And even throughout all the economic instability, the stock market has only persisted in expanding. This expansion has primarily advantaged just a tiny percentage of Americans: 10% of the population holds 93% of stock market wealth.

Despite the imbalance as this allocation seems, it's the financial structure working as it is existing today.

"Affluent individuals have purchased 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 stepping into this other chapter of maximum resource removal 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 utilizes a concept from journalist Robert Frank who, in a 2007 book on the rich, conceptualized the different levels of wealth as "Wealthville" villages: Prosperity Village, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

To modernize the concept, Collins categorizes these "economic communities" based on income levels:

• At the base level, 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 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.

Collectively, 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 said. "Whereas in Upper Richistan, you're using a private jet. That's a really separate reality. You fly private, you have no investment in the commercial aviation system. You don't care if the whole system collapses – 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 richest. The influence that this group has greatly exceeds those who are simply well-off, let alone the average American who doesn't reside in "Richistan" at all.

But Collins thinks the political catchphrase "end extreme wealth" fails to address the core issue and has a "whiff of exterminism" to it.

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

Fortune Building Strategies

To understand how wealth at the billionaire level works, Collins breaks it down into four parts: getting the wealth, defending the wealth, political capture and extreme wealth removal.

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 strategy 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 deliberate about their taxes.

"Wealth defense professionals use a extensive selection of tools such as legal entities, offshore bank accounts, anonymous shell companies, charitable foundations and other vehicles to hold assets," he explains.

Government Power and Extreme Wealth Removal

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

The final phase is a different kind of wealth accumulation, one that Collins calls "maximum taking" to describe how the wealthy have come to touch nearly every single part of an Americans' daily existence largely through private equity, which allows wealthy individuals to invest in private companies.

"Private equity is seeking those sectors of the economy where they can increase profits a little bit harder," Collins said. "One thing I don't think people understand is these billionaire private-equity funds are what happens when so much wealth is stored 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 consequences 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 significant salary growth. And Collins said the pain and frustration of this kind of society can lead to deep discontent.

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

Government Truth

The paradox, Collins points out in his book, is that political leaders have appointed a string of billionaires to administrative posts. Along with wealthy entrepreneurs who had temporary but significant roles overseeing significant decreases to the federal workforce, other key positions for commerce, treasury, education and the interior are also all billionaires.

This administrative framework, along with help from political partners, helped pass huge tax bills, which will make enduring decreases for the wealthy and corporations.

The Path Forward

While political parties continue to argue that foreign entry and poor economic deals are the source of everyone's economic problems, "the challenge is: 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 "alter economic flow", 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 bulk of people who really want lawmakers to solve some of these pressing issues," Collins said. "Wealthy influence is not about building so much as stopping. 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 continuous government action.

"It may be quickly that the pendulum swings back, 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 fix this. It is solvable."