The black swan event investors should fear is war, and the tapering that should concern them most is “geopolitical tapering.”

That was the impassioned message that economic historian and prominent conservative Niall Ferguson delivered on the closing day of Alegtris’ annual investment conference in San Diego, a tough hurdle, Ferguson quipped, saying “it’s hard to explain to people sitting in California that life can ever get bad.”

But noting that an act of state-sponsored terror in Sarajevo in 1914 precipitated World War I, the Harvard historian emphasized that investors in 2014 have more to worry about than a monetary taper that is often talked about but hasn’t actually happened.

Indeed, Ferguson said the main talk in Europe these days is when European Central Bank President Mario Draghi will move into full-throttled U.S.-style quantitative easing.

Rather, the taper American should focus on is one that has already happened — America’s geopolitical tapering from its post-Pearl Harbor role upholding international peace and security.

The problem, he said, goes far beyond the reduction in defense expenditures even as entitlement programs are increasing as a share of GDP.

The scaling back of the U.S. military presence in the Middle East and North Africa has indeed been dramatic. Ferguson noted we had 180,000 active duty U.S. military personnel when President Barack Obama was elected in 2008 and virtually none today.

That rapid change was made possible by a broader rise in isolationism that he argues is making the world an increasingly dangerous place...