The U.S. could see a huge outflow of educated, productive, upper-middle-class families from the high-tax urban blue states to more congenial places.
Investment implications? Look at two vibrant states that have no income taxes and have reasonable house costs. One is Washington State, especially in the urban centers of Seattle, Tacoma and Spokane, as well as in Vancouver, Wash., a suburb of Portland, Ore., which is the perfect tax arbitrage: no income tax in Washington, no sales tax in Oregon.
For what it's worth, Karlgaard also says that by raising taxes on households making $250,000 or more a year beginning in 2011, Obama is declaring "war on churches", jeopardizing missions to the developing world, and that as a result, "far away, children will die." Which kind of reminds us of this.