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Among countless US citizens, the financial landscape over the last half-decade has been challenging. Prices have skyrocketed while wages remains stagnant. Steep mortgage rates have made buying a home a grim prospect. The rate of unemployment has been creeping up.

Many Americans have indicated they're putting off major life decisions, including starting a family or switching jobs, because of economic uncertainty. But for a very small group of people, the last five years couldn't have been more prosperous.

Wealth Explosion

The fortune of the world's billionaires grew 54% in 2020, at the climax of the pandemic. And even during all the financial uncertainty, the stock market has only persisted in expanding. This increase has largely benefited just a tiny percentage of Americans: 10% of the population owns 93% of stock market wealth.

However unequal as this division seems, it's the system working as it is currently designed.

"The wealthy have acquired their jets, they've purchased their multiple houses and mansions, but now they're acquiring senators and media outlets," explained economic inequality analyst Chuck Collins. "We're now stepping into this other chapter of maximum resource removal where the wealthy are taking advantage of the system of inequality."

Understanding Wealth Tiers

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

To modernize 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 net worth 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 flying 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 separate reality. 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."

Extreme Affluence Consequences

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 greatly exceeds those who are simply well-off, let alone the average American who doesn't reside in "Richistan" at all.

But Collins thinks the progressive slogan "end extreme wealth" fails to address the core issue and has a "hint of elimination" to it.

"It's the difference between private conduct and a framework of policies," Collins explained. "We should be focused on 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 breaks it down into four parts: accumulating assets, protecting assets, government influence and extreme wealth removal.

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 starting or running 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 calculated about their taxes.

"Wealth defense professionals use a broad range of tools such as trusts, offshore bank accounts, secret corporations, philanthropic entities and other mechanisms to hold assets," he details.

Government Power and Extreme Wealth Removal

To further a wealth defense strategy, a family needs political support. Wealth of over $40m translates 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 "hyper extraction" to describe how the wealthy have come to influence nearly every single part of an Americans' everyday life largely through investment firms, which allows wealthy individuals to support private companies.

"Private equity is looking for those sectors of the economy where they can extract value 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 stored 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 meaningful wage increases. 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 Republicans have been good at accessing a potent "phony populism".

Government Truth

The paradox, Collins points out in his book, is that political leaders have appointed a succession of billionaires to cabinet positions. Along with affluent innovators who had brief but powerful roles overseeing massive cuts to the federal workforce, other crucial appointments for commerce, treasury, education and the interior are also all billionaires.

This political landscape, along with help from congressional allies, helped pass significant fiscal policies, which will make permanent tax cuts for the wealthy and corporations.

Future Solutions

While government groups continue to argue that border policies and bad trade agreements 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 strengthening unions.

"It was so, so close, and the legislation really did reflect the will of the most of people who really want lawmakers to address some of these urgent problems," Collins said. "Wealthy influence is not about creating 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 ongoing legislative effort.

"It may be before we know it that the balance shifts, and then it really is about maintaining a continuous public campaign to make progress on this severe disparity we're living in," he said. "We can solve this. It is addressable."