I'll preface this with a little about how I view government.
Good government, like good personal budgeting, is taxing $100 for every $100 you spend.
Politics is whether you should spend $100, $200, or somewhere in between.
As long as we agree to tax what we spend, the incentives are properly aligned to discuss spending levels. When we tax only $75 for $100 of spending, or $150 for every $200, incentives are skewed and the political discourse is necessarily dishonest.
I like Mitch Daniels because he and I share the same view of Good government. He wants to balance the two, and I get excited that someone out there wants to have an honest political discussion.
My concern about Governor Daniels is that he'd like to spend $50 where maybe I'd prefer to spend $200. In his time as Governor, he has cut Government services severely... and from some of the articles I've read, perhaps too much so, especially in the area of services for mentally ill Hoosiers. Regardless, Governor Daniels spoke at CPAC, to a conservative audience this weekend... and I would desperately like everyone to watch his speech. We may disagree on the size of government, but I think Good government is more important than politics. So, please watch: it's 40 minutes well spent.
Mitch Daniels CPAC Speech on CSPAN. Or, the full printed text.
A quick recap of the speech from WaPo.