The answer to your question depends on a clarification of the concepts of reasoning and logic, and on a determination of what counts as a "problem" with relation to these concepts. It is probably most helpful if we begin by demonstrating how your question should be dispensed with according to basic conventions of philosophical terminology; thus, I'll try to explain why circular reasoning is a fallacious form of deductive reason. To this end, let's take Aristotle's definition of deductive logic as our basis:
A deduction is a discourse [logos] in which, certain things having been stated, something other than what is stated follows of necessity from their being so. (Prior Analytics I.1, 24b)
Given a certain set of premises, deductive inference should allow one to draw conclusions which are "something other than" the statements with which one begins.
According to modern logical jargon, validity is a property of an argument, such that an argument is said to be valid when its conclusions follow from its premises. According to this narrow definition, "Circular reasoning", "begging the question," or (to be latin about it) "petitio principii" is in fact a valid form of argument, but only in a trivial and vacuous sense. Such arguments only restate what they had assumed from the outset; thus undermining the very purpose of a logical argument.
It is easy to see both the validity and the vacuity of such a syllogism if we examine its simplest form:
A is B. (Premise)
Therefore, A is B. (Conclusion which is "circular" because it only restates what was already assumed.)
An argument is valid just so long as the conclusion follows from the premises, and the above syllogism obviously satisfies this condition. However, an argument which begs the question is still considered to be fallacious because it cannot be used to prove or demonstrate anything.
Searching google scholar for "begging the question" returns numerous articles. You may also want to consider taking a basic course in formal logic or reading an introductory book on the subject.
There are different conceptions of reason and logic according to which "circularity" of a certain sort is not problematic. Hegel, for instance, often talks in terms of circular movements of consciousness and reason, but this arises from a vastly different understanding of reason than we've discussed above. You might also want to investigate the idea of the "Hermeneutic Circle", which develops a logic of interpretive reflexivity founded on a divergent view of truth.
As far as I know, every careful and earnest thinker recognizes that, within the purview of deductive logic, circular reasoning is a sign of carelessness and is completely useless. Those that embrace some kind of circular reasoning do so only as a result of careful and deeply considered (which is not to say "accurate" or "correct") reconceptualization of the basic terms of philosophy.