Nobody can predict 5 year out. However, the country that can be ultra efficient by making their governance, health, manufacturing, military, etc AI-native will be far ahead in the game.
But that's not really even relevant to the debate. Insofar as software has made the world more efficient, it doesn't matter where it's written. That's the point of open source software, there's no tacit knowledge. When a country loses its nuclear engineering capacity that's dangerous because it takes a long time to rebuild. The only reason the Chinese are already competitive on LLMs but haven't managed to make a state-of-the-art jet engine is because the latter, unlike software, is difficult to copy and you don't need to worry about something you can copy.
And it's the only viable tool the US has left. It's reasonable they are freaking out.