"You know what really burns my ass?"
"A flame about three feet high?"
"Cute. No, it's the fact that this is part of the vicious circle." Kyle slumped in his chair and took a drink of his coffee. "I know that justice must be served and whomever smoked Willy should pay, but this won't end the cycle. Monsters aren't born; they're created. You've read the profile on Willy's father. He was a bastard. If anyone should be rotting in jail it should be him. He abuses Willy so Willy becomes a monster. Willy's actions hurt and kill innocent children so parents become obsessively overprotective. Children grow up sheltered and stifled so they rebel, or worse. The cycle is spinning out of control and it's become our job to clean up the mess. The whole damned thing's enough to make me want to puke."
Oooh, I really like this. I really only have one comment: Kyle seems like a fast-talking, street-smart guy, so hearing him say "whomever" right before "smoked Willy" feels off. His language on the whole is earthy, so I think it all should be--pare it down a bit--unless that's part of Kyle's character.
Maybe Jaye has more? :-)
You start out with a very funny couple of lines of dialog. However, it's the third chunk where things go a little astray. I agree with Stacia on the "whomever." It's grammatically correct, but this is dialog and it doesn't ring true given the informal tone of the rest of the dialog. Also, I'd encourage you to tighten that section. "No, it's the fact that this is all.." Could this be pared down to "No, it's the damned vicious circle."
The rest could use the same treatment. Cut "that" and forms of "to be" if possible, and combine ideas for more effect. You wrote: "You've read the profile on Willy's father. He was a bastard. If anyone should be rotting in jail it should be him."
Could be: "You've read the profile on Willy's father. If anyone needs to rot in jail, it's that bastard."
Now, that's just how I'd rewrite it. It's your book so put your own spin on it. The point is, tightening adds more immediacy and more weight to each word. Too many that's, the fact is, etc. bog down the prose. They can be effective if you're character is prevaricating, but that's not the point of his speech.
All that is tweaking, though. You've got a great foundation.