Look at airports that are owned by the municipality, they have no construction, no investment - because that would look like a deficit. Then look at commercial airports that can borrow money. Or compare AMTRAK to a commercial airline.
Not building new water treatment plants, or new transport links or new hospitals but just spending money patching up the old ones = fiscally responsible zero deficit? Now imagine a corporation whose plans were to spend no money on sales, expansion, R+D etc what would it's share price do?
I don't believe that government services are lower quality than private services because of a lack of spending.