When it comes to AI, Australia is a spectator at a UFC cage fight between the United States and China, except the spectators at this event are all inside the cage with the combatants, not safely in the stands.China is flooding the world with cheap, very capable AI models, trying to destroy the business models of the leading US companies.The Americans are desperately trying to stay ahead by building smarter, more dangerous and more expensive models.To mix metaphors, it's a race between Cadillacs and BYDs.All other governments are trying to figure out how to stay safe inside the cage while…