Y'know, I started reading that post with a view towards making a cynical, snarky comment, but by the end it didn't seem such a bad idea.
You'd need to make sure the karma system couldn't be gamed, though -- either by automated actions (kind comments on everybody's walls) or collusion (two people [or a person and a sockpuppet] conspiring to give each other karma). I'm not sure that's solvable.