The current rate of inequality is massively inefficient if you're trying to optimize happiness. The bottom 2 quintiles of Americans control so little wealth that keeping food on the table is their primary concern. Meanwhile, an extremely small and shrinking proportion of the population control an outsized amount of wealth, to the point where it's not reasonably usable in an efficient way by those people.
It's like saying that the proper way to divide 100 loaves of bread between 100 people is to give 1 person 95 loaves and every other person a slice of bread. No one is starving, but you're making 1 person very happy at the expense of 99 others.