With more money ending up in the hands of those with money, because that's how leverage works, there is an imbalance. The biggest problem to arise from that is the wealth involving itself in our governmental process. The lobbying, the super pacs, citizens united are incentivizing further those more capable financially to obtain more money. Instead of creating a system to improve the effectiveness of the wealthy we should increase the ability of those lower down to increase.
Note that our government spends way too much money as is but that doesn't mean there are not worth while programs. Determining which ones are and are not and how efficient they are is what we need to accomplish. Draconian cuts are extremely wasteful and is very much the worst part about the fiscal cliff.
Government should essentially do what the people agree to let them do. Things that could otherwise not be handled in the private sector, and yes that includes environmental and public transport. Loopholes and deductions should be removed as a way to eliminate influences on market behavior while increasing taxes on the highest income earnings or at the very least implement a progressive investment tax instead of a flat rate that encourages the wealthy to forgo traditional income. Investment should be more open to individuals who have little to invest, negligible taxes .to little annual investment income, basically match investments to normal income rates.