Designating the Muslim Brotherhood as a terrorist organization would have deleterious consequences in many Arab states:

Of all the initiatives of the Trump administration that have set the Arab world on edge, none has as much potential to disrupt the internal politics of American partners in the region as the proposal to criminalize the Muslim Brotherhood, the pre-eminent Islamist movement with millions of followers. “The impact would be great,” said Issandr El Amrani, an analyst with the International Crisis Group based in Morocco, where a Brotherhood-linked party won the last election in October. “It could destabilize countries where anti-Islamist forces would be encouraged to double down. It would increase polarization.”

Perhaps the most striking thing about the proposed designation is that it would be quite harmful while being completely useless. It is self-defeating in the extreme to treat peaceful Islamist parties in aligned states as criminals, and it would harm our relations with many states that have traditionally been among the most cooperative in the region. At the same time, it would be perceived as an endorsement of the repression of despotic clients, and that would make even more enemies for the U.S.

The costs to these countries in terms of greater instability would be significant, but there would be no security benefit derived from such a designation because the group doesn’t merit being listed as a terrorist organization. Like issuing a blanket ban on allowing in nationals from seven predominantly Muslim countries, designating the Muslim Brotherhood does nothing to thwart terrorism and imposes unnecessary burdens on large numbers of people mainly to satisfy a clutch of fanatics here at home. Worse, wrongly designating nonviolent groups as part of a terrorist organization feeds into jihadist propaganda and potentially encourages political violence. The administration’s main “counter-terrorism” initiatives so far have nothing to do with countering terrorism and everything to do with indulging excessive fear of people that do not pose a threat to the U.S.

Update: Noah Feldman spells out the serious domestic consequences of designating the Muslim Brotherhood as a terrorist organization: