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Among countless individuals in the United States, the financial landscape over the past five years has been tough. Expenses have soared while wages remains flat. High mortgage rates have made purchasing property a grim prospect. The unemployment rate has been slowly rising.

Many Americans have indicated they're putting off major life decisions, including raising children or changing careers, because of the instability. But for a tiny fraction of people, the past five-year period couldn't have been any better.

Fortune Expansion

The assets of the world's billionaires grew 54% in 2020, at the height of the pandemic. And even during all the financial uncertainty, the stock market has only kept rising. This expansion has primarily advantaged 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 financial structure working as it is existing today.

"Affluent individuals have purchased their jets, they've bought their multiple houses and mansions, but now they're acquiring senators and media outlets," explained wealth disparity expert Chuck Collins. "We're now entering this other chapter of extreme wealth extraction where the wealthy are taking advantage of the system of inequality."

Mapping Economic Classes

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

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

• At the lowest tier, 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 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 using a private jet. That's a really distinct lifestyle. You fly private, you have no interest in the commercial aviation system. You don't care if the whole system shuts down – you're set."

The Billionaireville Effect

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 far surpasses those who are simply wealthy, let alone the ordinary person who doesn't inhabit "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 system of rules," Collins explained. "We should be worried about an economic system that channels so much wealth upward to the billionaires."

Wealth Accumulation Mechanisms

To understand how wealth at the billionaire level works, Collins divides it into four parts: acquiring fortune, securing fortune, policy control 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 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 trusts, international accounts, undisclosed businesses, non-profit organizations and other vehicles to hold assets," he writes.

Government Power and Extreme Wealth Removal

To enhance 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 protect its accumulation.

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 private equity, which allows wealthy individuals to fund private companies.

"Private equity is seeking those areas of the economy where they can extract value 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 accumulated in so few hands, and they can kind of turn around 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 boost their expenses."

Tangible Effects

The consequences of this inequality go beyond the wealth getting wealthier. It's about people paying more for their healthcare, rent and vet bills without seeing any meaningful wage increases. And Collins said the pain and frustration of this kind of society can lead to profound dissatisfaction.

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

Political Reality

The irony, Collins points out in his book, is that government officials have appointed a string of billionaires to government roles. Along with tech billionaires who had brief but powerful roles overseeing massive cuts to the federal workforce, other important roles for commerce, treasury, education and the interior are also all billionaires.

This administrative framework, along with help from congressional allies, helped pass major tax legislation, which will make permanent tax cuts for the wealthy and corporations.

The Path Forward

While political parties continue to argue that immigration and bad trade agreements are the source of everyone's economic problems, "the issue remains: Will the opposing party, 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 "change wealth distribution", including substantial modifications to the tax system, increasing the minimum wage and strengthening unions.

"It was so, so close, and the bill really did reflect the will of the majority of people who really want lawmakers to address some of these pressing issues," Collins said. "Wealthy influence is not about developing so much as stopping. It's easier to block than it is to make something meaningful happen, but the muscle memory is there. We know what that looks like."

Collins is hopeful that there can be change, but said it would require sustained political momentum.

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