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Among countless individuals in the United States, the financial landscape over the last half-decade has been tough. Prices have skyrocketed while wages remains unchanged. Steep mortgage rates have made purchasing property a bleak prospect. The unemployment rate has been slowly rising.

The majority of individuals have indicated they're putting off major life decisions, including raising children or changing careers, because of economic uncertainty. But for a select few of people, the last five years couldn't have been more prosperous.

The Billionaire Boom

The wealth of the world's billionaires expanded 54% in 2020, at the peak of the pandemic. And even during all the market volatility, the stock market has only persisted in expanding. This increase has mostly helped just a limited group of Americans: 10% of the population holds 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 purchased their jets, they've bought their multiple houses and mansions, but now they're securing senators and media outlets," explained economic inequality analyst Chuck Collins. "We're now moving into this other chapter of hyper-extraction where the wealthy are preying on the system of inequality."

Understanding Wealth Tiers

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

To modernize the concept, Collins organizes these "economic communities" 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 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 traveling 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 distinct lifestyle. You fly private, you have no stakes in the commercial aviation system. You don't care if the whole system collapses – 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 wealthiest. The influence that this group has substantially outweighs those who are simply wealthy, let alone the average American who doesn't inhabit "Richistan" at all.

But Collins thinks the activist mantra "abolish billionaires" misses the point and has a "hint of elimination" to it.

"It's the separation between individual behaviors and a system of rules," Collins said. "We should be concerned 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 divides it into four parts: acquiring fortune, defending the wealth, government influence and hyper-extraction.

When many Americans think about wealth, they usually think exclusively 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 membership in Affluent Town.

But getting to Billionaireville requires substantial commitment and strategy in those next three steps. Collins describes what he calls the "fortune security field": the tax lawyers, accountants and wealth managers who use their skills 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, foreign deposits, undisclosed businesses, philanthropic entities and other vehicles to hold assets," he explains.

Government Power and Extreme Wealth Removal

To enhance a wealth defense strategy, a family needs government backing. Wealth of over $40m converts to political power, Collins says, and can be used to secure fortune and ensure continued growth.

The ultimate step is a different kind of wealth accumulation, one that Collins calls "extreme removal" to describe how the wealthy have come to influence nearly every single part of an Americans' everyday life largely through capital management, which allows wealthy individuals to support private companies.

"Private equity is seeking those corners 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 generate returns out of the economy?' Healthcare? Great. Mobile home parks? These people can't go anywhere, [so] you can raise their rents."

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

"The most powerful wealthy elites understand people are being left behind [and] are financially struggling," Collins said, adding that right-leaning leaders have been good at connecting with a potent "fake grassroots movement".

Government Truth

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

This government structure, along with help from congressional allies, 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 bad trade agreements are the source of everyone's economic problems, "the challenge is: Will the other major party, which has also been captured by the billionaires and big money, be able to seriously confront the underlying harms?" Collins said.

Left-leaning officials, he argues, know what policies are needed to "alter economic flow", including significant reforms to the tax system, boosting the minimum wage and supporting labor organizations.

"It was so, so close, and the law really did embody the will of the most of people who really want lawmakers to fix some of these pressing issues," Collins said. "Elite control is not about developing so much as blocking. 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 hopeful that there can be change, but said it would require sustained political momentum.

"It may be sooner than expected that the tide turns, and then it really is about maintaining a continuous public campaign to make progress on this profound imbalance we're living in," he said. "We can fix this. It is addressable."