I learned recently that you can also do this on the command-line with "git diff -b"
On an related note - another nice diff flag I discovered recently is "git diff --word-diff" - which will as the name suggests, diff by word instead of line.
GNU diff supports -b (--ignore-space-change) and -B (--ignore-blank-lines) plus if you want to go all out -w (--ignore-all-space).