The Strong Towns argument is effectively talking about density as tax-revenue per road mile liability, and trying to keep that positive. Areas with high liabilities (sewer, water, buried electric, fiber, etc.) need to have higher tax-revenue per mile (more people, more businesses, etc) to support that infrastructure.

There are other ways around this though. If you force your citizens to maintain their own septic and well water (or even small-pipe potable water), and have unsurfaced roads, then you can do with much less revenue-per-road mile.

The point is that the federal government usually pays for the infrastructure up from (as an "investment"), but when that subsidized infrastructure is a net money-loser in the long run, cities growing actually makes the problem worse.

Tax revenue per area is generally a good metric in terms of the sustainability of a municipal budget. Very few suburbs in the world have enough people density to clear that bar, no matter how much they tax them. More people density lets you clear the bar so much easier even when the incomes are drastically lower.