Assuming they continue to move forward with this, the tech keeps advancing, and they apply it to increasing intelligence, how should society respond if they are being left in the dust?

It seems the only real option is follow along or hope you don't get exterminated once the gap is big enough in case they feel lesser people are not worth the resources they take up (or decide to enslave them maybe). Not saying China would do this, but who knows how that situation could evolve, particularly as resources get more and more scarce.