The best students should always be the priority of every government and university as a given. This ensures that the best leaders are taught and prepared to lead the country. That being said, the definition of "the best" needs to expand, especially when considering specific programs. The best person at math, for example, is not especially the best person for an English program.
I believe that a good step to take would be to bring in the most intelligent people possible from all around the world. There is no reason not to. The displacement of American students would be marginal. However, I believe that these students should become American citizens through their studies so that they will stay and use their degrees in their host country. If they want to go back, they should be able to.