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To numerous US citizens, the economy over the recent five-year span has been difficult. Prices have soared while pay remains flat. Elevated mortgage rates have made purchasing property a grim prospect. The jobless rate has been slowly rising.

The majority of individuals have indicated they're putting off major life decisions, including having kids or switching jobs, because of the instability. But for a tiny fraction of people, the past five-year period couldn't have been any better.

The Billionaire Boom

The assets of the world's billionaires increased 54% in 2020, at the height of the pandemic. And even throughout all the economic instability, the stock market has only kept rising. This increase has largely benefited just a limited group of Americans: 10% of the population holds 93% of stock market wealth.

However unequal as this division seems, it's the financial structure working as it is existing today.

"Affluent individuals have purchased their jets, they've purchased their multiple houses and mansions, but now they're buying senators and media outlets," explained economic inequality analyst Chuck Collins. "We're now moving into this other chapter of extreme wealth extraction where the wealthy are preying on the system of inequality."

Mapping Economic Classes

To help others comprehend 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, imagined the different levels of wealth as "Richistan" villages: Prosperity Village, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

To contemporize the concept, Collins categorizes these "economic communities" based on income levels:

• At the lowest tier, Affluent Town, are the 10 million Americans who have a family earnings of at least $110,000 and an total assets 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.

Altogether, the residents of these villages constitute the top 10% of the wealth income distribution, about 14 million Americans altogether, though their lifestyles 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 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 power that this group has substantially outweighs those who are simply affluent, let alone the average American who doesn't reside in "Richistan" at all.

But Collins thinks the activist mantra "billionaires shouldn't exist" misses the point and has a "hint of elimination" to it.

"It's the distinction between individual behaviors and a structure of regulations," Collins said. "We should be worried about an economic system that channels so much wealth upward to the billionaires."

The Four Pillars of Billionaire Wealth

To understand how wealth at the billionaire level works, Collins separates it into four parts: getting the wealth, defending the wealth, policy control and hyper-extraction.

When many Americans think about wealth, they usually think exclusively about the first step, Collins said. People can create a reasonable quantity of wealth through creating or operating a successful business, which could get them membership in Affluent Town.

But getting to Billionaireville requires serious investment and tactics in those next three steps. Collins describes what he calls the "asset protection sector": the tax lawyers, accountants and wealth managers who use their expertise to ensure that the super rich are being deliberate about their taxes.

"Wealth defense professionals use a extensive selection of tools such as trusts, international accounts, anonymous shell companies, charitable foundations and other methods to hold assets," he writes.

Political Influence and Hyper-Extraction

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

The last stage is a different kind of wealth accumulation, one that Collins calls "hyper extraction" to describe how the wealthy have come to touch nearly every single part of an Americans' routine activities largely through capital management, which allows wealthy individuals to support private companies.

"Private equity is searching 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 accumulated in so few hands, and they can essentially pivot 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 increase their costs."

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 suffering and anger of this kind of society can lead to serious unrest.

"The most powerful affluent rulers understand people are being excluded [and] are monetarily hurting," Collins said, adding that Republicans have been good at accessing a potent "false common-man appeal".

Government Truth

The contradiction, Collins points out in his book, is that elected representatives have appointed a succession of billionaires to cabinet positions. Along with wealthy entrepreneurs who had brief but powerful roles overseeing significant decreases 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 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 poor economic deals are the source of everyone's economic problems, "the question becomes: Will the alternative political group, 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 deep changes to the tax system, raising the minimum wage and strengthening unions.

"It was so, so close, and the legislation really did represent the will of the majority of people who really want lawmakers to address some of these pressing issues," Collins said. "Elite control is not about creating so much as stopping. It's easier to block than it is to make something meaningful happen, but the historical precedent is there. We know what that looks like."

Collins is positive 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 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."