Mother Jones has an article on speculation that Mitch Daniels could run for President. Given the publication, I think we can safely assume that the author would prefer that any Republican nominee lose the 2012 election. With that bias in mind, the author identifies some weak spots in Daniels’ resume:

#Privatizing the toll road and awarding the contract to a foreign company.
#Being a Washington insider — “Dick Cheney’s Dick Cheney”
#Being instrumental in the Bush tax cuts that led us to big deficits.
#Being disastrously wrong about the cost of the Iraq War as Director of the OMB.
#Being way off the mark with the prediction, in 1994, that the market would correct rising health care costs.

A lot of these things are features, rather than bugs, when it comes to landing the Republican nomination, however they might play in the general election.

In a hypothetical primary, I think Daniels’ conservative weak spots would be his failure to wear religion on his sleeve and his willingness to raise taxes (see, e.g., the Indiana sales tax increase as well as his other various tax increase proposals that ultimately were not adopted.)