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Among countless individuals in the United States, the economic climate over the past five years has been tough. Prices have soared while pay remains flat. High mortgage rates have made buying a home a grim prospect. The unemployment rate has been creeping up.

The majority of individuals have reported they're delaying major life decisions, including having kids or changing careers, because of the instability. But for a very small group of people, the past five-year period couldn't have been more prosperous.

Wealth Explosion

The assets of the world's billionaires expanded 54% in 2020, at the peak of the pandemic. And even amid all the financial uncertainty, the stock market has only continued to grow. This expansion has mostly helped just a tiny percentage of Americans: 10% of the population controls 93% of stock market wealth.

However unequal as this allocation seems, it's the economic framework working as it is currently designed.

"Affluent individuals have acquired their jets, they've bought their multiple houses and mansions, but now they're acquiring senators and media outlets," explained inequality researcher Chuck Collins. "We're now stepping into this other chapter of extreme wealth extraction where the wealthy are exploiting the system of inequality."

Mapping Economic Classes

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

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

• At the foundation, Affluent Town, are the 10 million Americans who have a household income 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.

In total, 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 noted. "Whereas in Upper Richistan, you're flying in a private jet. That's a really different cultural experience. 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 summit in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's most affluent. The power that this group has substantially outweighs those who are simply well-off, let alone the ordinary person 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 separation between personal actions and a system of rules," Collins said. "We should be focused on 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: getting the wealth, securing fortune, political capture and maximum resource 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 creating or operating a successful business, which could get them membership in Affluent Town.

But getting to Billionaireville requires substantial commitment 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 knowledge to ensure that the super rich are being strategic about their taxes.

"Wealth defense professionals use a extensive selection of tools such as legal entities, offshore bank accounts, secret corporations, philanthropic entities and other methods to hold assets," he details.

Political Influence and Hyper-Extraction

To advance a wealth defense strategy, a family needs political support. Wealth of over $40m translates to political power, Collins says, and can be used to defend wealth and protect its accumulation.

The last stage is a different kind of wealth accumulation, one that Collins calls "maximum taking" 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 support private companies.

"Private equity is seeking those sectors 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 parked in so few hands, and they can kind of turn around and say, 'Where else can we squeeze money out of the economy?' Healthcare? Great. Mobile home parks? These people can't go anywhere, [so] you can increase their costs."

Tangible Effects

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 hardship and discontent of this kind of society can lead to profound dissatisfaction.

"The most powerful affluent rulers understand people are being marginalized [and] are monetarily hurting," Collins said, adding that right-leaning leaders have been good at connecting with a potent "false common-man appeal".

Government Truth

The contradiction, Collins points out in his book, is that political leaders have appointed a succession of billionaires to cabinet positions. Along with wealthy entrepreneurs who had short yet influential roles overseeing massive cuts 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 huge tax bills, 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 other major party, which has also been controlled 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 "change wealth distribution", including significant reforms to the tax system, increasing the minimum wage and empowering worker groups.

"It was so, so close, and the bill really did reflect 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 building so much as stopping. It's easier to block than it is to make something significant occur, but the institutional knowledge 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 pendulum swings back, 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 fix this. It is solvable."