Easiest way to go toe-to-toe with Vicious AI I've found is simply to expand as much as you can, then get starbases at all vulnerable worlds. Upgrade them as they get attacked so that you don't get caught with too little cash. (Defense first, then weapons, hangar last if you absolutely need it.) The basic non-researched starbase upgrades for TEC will work just fine if you support them with repair bays and later hangar bays.
Makes for great leveling grounds for caps, and you can stay at very low levels of fleet research this way, meaning you get a lot more income to pour into starbases, defenses, and research. Get culture for your caps and tech up to Pervasive Economy. Once you do, you'll have the cash for just about anything you need. On the other hand, it's gonna take a long time to go on the offensive with this strategy.
If this strategy succeeds, only massive AI fleets can crack the static defenses alone, while your small supporting fleet can easily turn the tide.