The traditional "elements" are an arbitrary list of matter, energy, or the two interacting. None of them are actually in any sort of conflict with one another, they are simply interacting and affecting each other.
First off, what an element is tends to be rather vague or overly inclusive:
Air can mean anything from wind to the relatively common gasses in our atmosphere.
Fire can mean anything from flames (which are not a substance but a chemical reaction) to lava from volcanic eruptions or the eruptions themselves.
Earth can mean any of the hundreds of naturally occurring solid (Periodic Table of) elements in the earth (metals included), or any of the thousands of combinations of those elements. Additionally, it can also mean plants, especially large wood trees.
Water is the most straightforward of the traditional, mythological, elements. Mist, dew, streams, oceans, glasses of...water.
No real reason why they are singled out as fundamental. It's also well-known that they are not, in fact, fundamental. Atoms are the basic buildings blocks of matter, and the transmitters of energy.
Secondly; no element has anything to lose or gain for another. Water doesn't "win" if it extinguishes a fire. It doesn't get points, get more voting in "element congress", or win a medal of some kind.
In reality, all of the elements are working in tandem. They are interacting on a massive scale, and in most cases they are creating each other.
The gravity of our hot sun helped condense Hydrogen and Oxygen to make H2O, it then heated it to liquid form. It, of course, condensed space matter and dust into the Earth itself, creating the "earth" element. Air and wood create fire, the oceans and sun create wind...etc...etc...etc...
No winning, no losing, just the beautiful orchestra of our world and universe.
