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Among countless individuals in the United States, the financial landscape over the past five years has been tough. Costs have soared while pay remains unchanged. Elevated mortgage rates have made homeownership a grim prospect. The unemployment rate has been slowly rising.

The majority of individuals have stated they're delaying major life decisions, including starting a family or moving to new employment, because of economic uncertainty. But for a tiny fraction of people, the recent half-decade couldn't have been any better.

Fortune Expansion

The fortune of the world's billionaires expanded 54% in 2020, at the height of the pandemic. And even amid all the financial uncertainty, the stock market has only kept rising. This growth has primarily advantaged just a small number of Americans: 10% of the population controls 93% of stock market wealth.

However unequal as this division seems, it's the system working as it is presently configured.

"The wealthy have acquired their jets, they've acquired their multiple houses and mansions, but now they're acquiring senators and media outlets," stated inequality researcher Chuck Collins. "We're now entering this other chapter of hyper-extraction where the wealthy are taking advantage of the system of inequality."

Understanding Wealth Tiers

To help others understand 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 "Affluencia" 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 foundation, 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 exclusive 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 experiences vary dramatically.

"You could be in Lower Richistan, and you're still traveling in the coach section of a commercial plane," Collins said. "Whereas in Upper Richistan, you're using 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 collapses – you're set."

Extreme Affluence Consequences

The peak in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's wealthiest. The power that this group has substantially outweighs those who are simply wealthy, let alone the ordinary person who doesn't inhabit "Richistan" at all.

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

"It's the distinction between personal actions and a structure of regulations," Collins said. "We should be focused on an economic system that channels 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: getting the wealth, securing fortune, government influence 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 creating or operating a successful business, which could get them admission in Affluent Town.

But getting to Billionaireville requires significant resources and strategy 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 calculated about their taxes.

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

Political Influence and Hyper-Extraction

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

The ultimate step 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 private equity, which allows wealthy individuals to invest in private companies.

"Private equity is looking for those areas of the economy where they can squeeze things 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 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 effects of this inequality go beyond the wealth getting wealthier. It's about people spending additional funds for their healthcare, rent and vet bills without seeing any significant salary growth. And Collins said the pain and frustration of this kind of society can lead to deep discontent.

"The most powerful oligarchs understand people are being marginalized [and] are financially struggling," Collins said, adding that conservative politicians have been good at accessing a potent "fake grassroots movement".

Government Truth

The irony, Collins points out in his book, is that political leaders have appointed a string of billionaires to cabinet positions. Along with affluent innovators who had temporary but significant roles overseeing substantial reductions 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.

Future Solutions

While political parties continue to argue that immigration and unfavorable commercial treaties are the source of everyone's economic problems, "the challenge is: Will the opposing party, which has also been captured 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 substantial modifications to the tax system, boosting the minimum wage and supporting labor organizations.

"It was so, so close, and the law really did represent the will of the most of people who really want lawmakers to solve some of these urgent problems," Collins said. "Wealthy influence is not about developing so much as stopping. It's easier to block than it is to make something substantial take place, but the institutional knowledge is there. We know what that looks like."

Collins is positive that there can be change, but said it would require ongoing legislative effort.

"It may be quickly that the pendulum swings back, and then it really is about sustaining a ongoing grassroots effort to make progress on this profound imbalance we're living in," he said. "We can solve this. It is addressable."