A sign in Kokomo, Ind.Photo: davitydaveEighteen months ago, the city of Kokomo, Ind., was one of those American Rust Belt towns that looked like it was clanking toward irreversible decay.

Today, according to a story on CNN Money, the city of some 45,000 people is revitalized and renewed, thanks to an infusion of federal stimulus money and a variety of economic strategies. The unemployment rate has gone from over 20 percent to 14 percent. Stores have moved from the dying mall to a newly vibrant downtown. And the mood is cautiously hopeful.

What makes the Kokomo story particularly interesting is that the revival illustrates how different types of stimulus funding can work together when they’re intelligently deployed. Some of the money is from the auto bailout and is going to build hybrid cars. Some is slated for green tech jobs. And some of it is infrastructure spending that is being used to beautify downtown, help businesses get started, and create streets that draw more pedestrian traffic.

Chrysler, which had idled 3,500 hourly workers in Kokomo a year and a half ago, recently announced $350 million in new investments that will make the city the hub of North American manufacturing for its next-generation transmissions. All those people have been put back to work, and 700 others have been hired.

Auto parts manufacturer Delphi will use an $89 million stimulus grant to retain 100 manufacturing jobs and make 100 additional hires at a facility building parts for hybrid vehicles. (Kokomo then: A town on the brink)

And a Colorado solar company plans to use $300 million in stimulus funds to hire as many as 900 workers at an old Daimler auto plant south of town that will make products to export to Europe.

Even the downtown looks better. The mayor leveraged $800,000 in stimulus funds to help with a revitalization project that has netted 11 new stores since the start of the year.

The CNN story has a great slideshow that details some of the improvements, including a state-of-the-art electronics manufacturing facility and a bar that is being built from recycled antique lumber and glass.

There’s been a lot of rhetoric from Republicans and conservative Democrats leading up to the midterm elections about how the federal stimulus has been a boondoggle, a waste of taxpayer dollars. (That hasn’t stopped many of those same politicians from trying to grab some of the cash for their districts.)

They might want to ask the people of Kokomo if they think the money has been poorly spent.