By Simon Bond

Recently we have seen significant changes in the social and economic global fabric. Markets everywhere rely on confidence and transparency. Which makes the recent Brexit event and Australian election result all the more interesting.

People may be alarmed and confused but what we are witnessing is actually the result of the "breaking of the social contract".

Taxation is inevitable. It pays for the things that serve the collective interest. Over-taxation can call people to arms, however. The line between the two, taxation and over-taxation, is embedded in the social contract between citizens and the state. It’s a flexible line, one that changes with time and circumstances, but in the main there is an understanding between citizens and their state as to where the line is drawn or at least where it ought to be.

Of course the French draw that line in a very different place from where Americans draw it, and both are some distance from where North Korea might draw the line. No one has a monopoly on the ‘best’ ‘right’ or ‘true’ social contract. Instead, it tends to represent a series of ‘deals’ that are forged over time, both forming and arising from the warp and weft of the social fabric.

But when governments demand too much of a citizen’s hard-earned cash, and fail to deliver on their promises, protests arise and Governments get voted out, or thrown out.

Recall the story of William Tell, a sharp marksman with a crossbow who objected to the onerous tax imposed by the Hapsburg king, who had invaded what we now call Switzerland. Gessler, the King’s appointed representative and tax collector, was outraged by Tell’s protests and threatened to imprison him unless he could shoot an apple off the head of his own son, Walter. William Tell shot the apple in two and avoided killing his son. Gessler went ahead and imprisoned him anyway when he found Tell had a second arrow stashed away and inquired what it was for. ‘If my first arrow had killed my son,’ Tell answered, ‘I would have shot the second at you, and I would not have missed.’ Tell escaped and came back to assassinate Gessler, thereby helping spur the revolution that led to the overthrow of the Hapsburgs and the creation of an independent Swiss Confederation.

Over the centuries we have seen time and again how citizens rise up and retaliate. How the Coalition and their advisors underestimated the blowback on their ill-conceived attack on superannuation is breathtaking in its naivety. How they took their constituents for granted, the political buffoonery was bewildering.

Remember the ultimate value of all assets rests on their ability to produce goods and services in the future, and we need the right environment to continually foster this - break the social contract and your gone.

Now Malcolm Turnbull has taken office, he may be well advised to watch out for anyone with a quiver. That second arrow is never far away.