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For many Americans, the economy over the last half-decade has been difficult. Prices have skyrocketed while wages remains unchanged. High mortgage rates have made homeownership a grim prospect. The unemployment rate has been creeping up.

Many Americans have stated they're delaying major life decisions, including starting a family or moving to new employment, because of the instability. But for a tiny fraction of people, the recent half-decade couldn't have been more successful.

The Billionaire Boom

The assets of the world's billionaires increased 54% in 2020, at the peak of the pandemic. And even during all the financial uncertainty, the stock market has only kept rising. This growth has primarily advantaged just a limited group of Americans: 10% of the population holds 93% of stock market wealth.

However unequal as this distribution seems, it's the financial structure working as it is presently configured.

"Affluent individuals have bought their jets, they've bought their multiple houses and mansions, but now they're securing senators and media outlets," explained inequality researcher Chuck Collins. "We're now stepping 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 "affluent" 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 "Affluencia" villages: Affluent Town, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

To update the concept, Collins organizes these "wealth villages" based on income levels:

• At the lowest tier, Affluent Town, are the 10 million Americans who have a annual salary of at least $110,000 and an overall wealth 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 constitute 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 traveling in the coach section of a commercial plane," Collins explained. "Whereas in Upper Richistan, you're traveling via 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 fails – you're set."

The Billionaireville Effect

The highest hill in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's wealthiest. The influence that this group has substantially outweighs those who are simply wealthy, let alone the typical citizen who doesn't live in "Richistan" at all.

But Collins thinks the progressive slogan "end extreme wealth" misses the point and has a "hint of elimination" to it.

"It's the difference between private conduct and a framework of policies," Collins said. "We should be concerned 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 breaks it down into four parts: getting the wealth, 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 modest amount of wealth through starting or running a successful business, which could get them residency in Affluent Town.

But getting to Billionaireville requires serious investment and planning in those next three steps. Collins describes what he calls the "asset protection sector": 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, international accounts, anonymous shell companies, philanthropic entities and other vehicles to hold assets," he writes.

Government Power and Extreme Wealth Removal

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

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' routine activities largely through private equity, which allows wealthy individuals to invest in private companies.

"Private equity is looking for those corners 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."

The Real Consequences

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 substantial income improvement. And Collins said the pain and frustration of this kind of society can lead to profound dissatisfaction.

"The most powerful oligarchs understand people are being left behind [and] are financially struggling," 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 government officials have appointed a series of billionaires to administrative posts. Along with affluent innovators 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 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 unfavorable commercial treaties are the source of everyone's economic problems, "the issue remains: Will the alternative political group, which has also been influenced by the billionaires and big money, be able to effectively tackle the underlying harms?" Collins said.

Liberal leaders, he argues, know what policies are needed to "reverse the updraft of wealth", including significant reforms to the tax system, boosting the minimum wage and supporting labor organizations.

"It was so, so close, and the legislation really did embody the will of the most of people who really want lawmakers to fix some of these urgent problems," Collins said. "Elite control is not about creating so much as blocking. It's easier to block than it is to make something significant occur, 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 sustaining a sustained really popular movement to make progress on this profound imbalance we're living in," he said. "We can solve this. It is fixable."