I'd say competition is good. The large investments in datacenters in the US is also a sign that both politicians and business owners understand the risk of falling behind China, and that's a good thing. This race will intensify, and hopefully the consumers will win in the end. I'm expecting a bubble burst and a new era of progress right after, just like during and after the .com crash.
I agree that'd be good long term, like the dot com crash. But I wouldn't write off the short term negatives either- the dot com crash was not fun for a lot or people, an AI crash isn't set to be a blast either.