I definately think that funding for scientific endeavors should constitute a higher proportion of the budget than the US, for example. That would include space exploration (which is, of-course, my other passion). Government spending might also involve cash prizes to encourage private developments in these areas as-well.
Perhaps the line between government and private endeavorship would best be a blurry one, or perhaps they should remain well independent. I'm not sure. Does anyone have further thoughts?
As for the process by which the government decides to allocate its spending: again, I'm not sure how it should work. I guess it depends on how you want to structure the government. This would be defined by the constitution which is all up in the air right now (too many possibilities!). I wonder what the standard process is in your typical theoretical e-democracy?
Good ideas though. Keep 'em coming.