This whole discussion of what's a useful signaling device is probably more than a bit off the original topic. If you're looking for more information, have a look at this discussion:
Best signalling equipment from the searchers point of view
My conclusions from this are, fairly intuitively, when relatively close by and the searcher is on the surface, something bright and tall like an SMB is workable. The taller the better, and past a certain point, height is probably more valuable than width, which makes an SMB more convenient than a lift bag. Once you get far away, or searchers are in the air, the value of an SMB become very small and width or horizontal extent becomes important. Ideally, wide and tall is best, but there's a certain practical trade-off, and very few divers find it convenient to routinely carry around 1000 lb lift bags just in case. Tools like streamers, dye-packs or yes, garbage bags aren't ideal in all situations, but have their conveniences in terms of size, cost and availability.
Somewhat separate from that is color. You can argue endlessly about that, and people do, even professional safety gear manufacturers, let alone us amateurs.
I haven't gone back and re-read the entire thread, but I though the comment about garbage bags (i.e. a large sheet of floatable plastic which you might be able to wave in the air) wasn't presented as an 'instead of an SMB', but as something in addition to more conventional signaling gear that basically takes up almost zero room and cost, that you could stuff in your pocket just in case. (BTW, IIRC in the signaling equipment thread, I think some professional SAR people thought they'd find it easier to see orange Halloween garbage bags than other colors.)