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Among countless US citizens, the economic climate over the past five years has been difficult. Costs have escalated while wages remains stagnant. Steep mortgage rates have made homeownership a grim prospect. The jobless rate has been creeping up.

The majority of individuals have stated they're putting off major life decisions, including raising children or moving to new employment, because of economic uncertainty. But for a select few of people, the recent half-decade couldn't have been more successful.

Wealth Explosion

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 growth has mostly helped 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 acquired their jets, they've acquired their multiple houses and mansions, but now they're securing senators and media outlets," explained wealth disparity expert Chuck Collins. "We're now moving into this other chapter of extreme wealth extraction where the wealthy are exploiting 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, conceptualized the different levels of wealth as "Wealthville" villages: Prosperity Village, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

To update the concept, Collins categorizes 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 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 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 shuts down – you're set."

Ultra-Wealth Impact

The summit 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 far surpasses those who are simply well-off, let alone the average American who doesn't live in "Richistan" at all.

But Collins thinks the progressive slogan "abolish billionaires" misses the point and has a "suggestion of eradication" to it.

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

Wealth Accumulation Mechanisms

To understand how wealth at the billionaire level works, Collins breaks it down into four parts: accumulating assets, securing fortune, policy control and hyper-extraction.

When many Americans think about wealth, they usually think exclusively about the first step, Collins said. People can create a modest amount of wealth through establishing or managing a successful business, which could get them admission in Affluent Town.

But getting to Billionaireville requires substantial commitment and planning 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 strategic about their taxes.

"Wealth defense professionals use a extensive selection of tools such as trusts, foreign deposits, undisclosed businesses, charitable foundations and other methods to hold assets," he explains.

Government Power and Extreme Wealth Removal

To advance a wealth defense strategy, a family needs policy assistance. Wealth of over $40m converts to 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 affect nearly every single part of an Americans' daily existence largely through investment firms, which allows wealthy individuals to invest in private companies.

"Private equity is searching for those corners of the economy where they can increase profits 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 boost their expenses."

The Real Consequences

The effects 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 wealthy elites understand people are being excluded [and] are economically suffering," Collins said, adding that Republicans have been good at connecting with a potent "phony populism".

Government Truth

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

This government structure, along with help from legislative supporters, 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 foreign entry and unfavorable commercial treaties 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 "reverse the updraft of wealth", including deep changes to the tax system, raising the minimum wage and supporting labor organizations.

"It was so, so close, and the law really did embody the will of the bulk of people who really want lawmakers to solve some of these critical challenges," Collins said. "Elite control is not about creating so much as preventing. It's easier to block than it is to make something substantial take place, but the muscle memory is there. We know what that looks like."

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

"It may be sooner than expected that the pendulum swings back, and then it really is about maintaining a sustained really popular movement to make progress on this profound imbalance we're living in," he said. "We can fix this. It is solvable."