By seeking to close America’s doors to Muslims, Donald Trump has failed in his first big philosophical test as a potential president. The world’s largest economy got that way partly because it has been open to capital flows and people – including those from the Arab world. Real-estate mogul Trump seems not to grasp that the capitalism that made him rich depends on openness.
Think first about the financial interdependency. Dollars invested in U.S. debt by oil-rich sheikdoms of the Middle East have helped to finance gigantic U.S. deficits. Oil-exporting nations, including Muslim nations like Saudi Arabia and the United Arab Emirates, were the fourth-highest holders of Treasury securities up to the end of September, according to Treasury data.
In calling for closed borders, Trump was talking about people, not money. But it’s hard to imagine shutting the door to one of those without repelling the other. American companies from Citigroup to Twitter have also benefitted from infusions of Arab capital. The U.S. would have taken longer to emerge from the financial crisis had money from the Muslim world been frozen out.
Meanwhile Trump has been a direct benefactor of Middle East enclaves embracing America’s brand of free-market capitalism, which depends on the movement of people. At a time when Dubai was being described by President George W. Bush as a model Muslim state, Trump was trying to develop a real-estate project in the sheikhdom. His ties in Dubai span from golf to retail. Dubai-based billionaire Khalaf al-Habtoor – once a fan of Trump – has said he regrets ever backing him. Trump-related products have been dropped by a major Dubai retailer.
If anything, Trump’s bigoted tirade doubles down on a mistake made by his chief presidential adversary. Dubai was effectively blocked in 2006 by lawmakers including Democratic hopeful Hillary Clinton from operating six U.S. ports on national-security concerns, against the wishes of a Republican president. If Trump can’t see that open is better than closed, it’s hard to see how he can make America great again.