If the animals in circuses are respected then I personally do not see anything wrong with it. The issue here to consider is whether or not they are actually treated in the respectful manner that they deserve. I have heard horror stories about animals in circuses that have been mistreated and abused which is a shame. There are laws in place that protect these animals and I believe that people who mistreat them should be held responsible and suffer the consequences. With that being said, I have also heard stories about animals that have been rescued and placed in circuses and end up living wonderful lives.
The problem is not that wild animals are being caged. The problem is that in many circumstances the laws that are in place to protect these animals and ensure humane treatment are not always adequately enforced. In addition, Clairewait made about a great point about people avenge the opportunity to see these animals in zoos and circuses when they might never have another opportunity.
I think it is impossible to provide animals in the circus with the kind of comfort and health benefits that their natural environment will provide. That said, the treatment of animals in the circus today (as opposed to just 50 years ago) is much more humane and is comparable to the treatment that animals receive in zoos.
Many animal rights activists disagree with caging wild animals for entertainment purposes. I have to say, however, that in the interest of providing the opportunity to see animals many would not otherwise be able to travel and see, I do not personally have a problem with it.
If you are very interested in this subject, I have two fictional book recommendations which were both really entertaining reads: The Elephant Keeper by Christopher Nicholson and Water for Elephants by Sara Gruen (a movie of this book is currently in theaters).