In order to see what's going on, let's put them in empty space to get rid of any other influences, and let's also make it a push instead of a pull. / / / The horse pushes on the cart, so it begins accelerating away from him. At the same time, because of the equal opposite reaction thing, the cart pushes back on the horse, so the horse starts accelerating backwards, away from the cart. They both accelerate in opposite directions from where they started. BUT . . . their common center of mass doesn't move, and the sum of their momentums (which are in opposite directions) remains zero.
The argument that the horse cannot accelerate the cart due to equal and opposite forces is incorrect. While both the horse and cart exert forces on each other, the horse can still accelerate the cart forward by generating sufficient force. The entire system can be analyzed to show that the cart moves even with these opposing forces at play.
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