How effective is it to fund a researcher as opposed to a research idea? As I understand the funding model, it's generally the funder solicits research proposals, then choose those they find the most interesting/promising. The researcher who wrote the funding application then goes and does the research with the money. In other words, the funder mostly assesses the research idea, not so much the researcher.

Can the funder use a different model where they assess the researcher (not the researcher's ideas), give those they find the most qualified/promising a large sum of money, and let them do whatever they want? How effective would this be relative to the traditional model?
There are a few funding schemes which are working exactly in this direction, giving the researcher lots of freedom in their line of research. Sometimes, the funding comes in form of a "prize" and the prize may only be used for further research topics. 

In a smaller scale (you were talking about a larger amount of money) each tenuring decision is such a grant: The university is investing a significant amount of money into a person without any further control about the future research directions (at least in Germany). There is just some hope that people will not stop doing interesting things. If you sum up the regular amount of money a professor recieves, plus the additional staff / expenses granted, you end up with large amounts of money. I must say this freedom is something I really enjoy, and for me it is my major motivation for staying in academia. 

Of course, those professors still write grant applications...