The pasuk that the Chofetz Chaim quotes in the context of the severity of the sin of haughtiness is preceded by a passage which discusses how HaShem provided for The B’nei Yisrael (Jewish People) in the Sinai Desert, providing us nourishment with the manna, making sure our clothes wouldn’t wear out and protecting us from the surrounding dangers. (D’varim: 8; 1 – 4) Then The Torah tells us that when HaShem brings us afflicting, it is for our good, as a loving father would afflict his child, this being in the context of our benefit. (Devarim: 8; 5) We then learn that we should fear HaShem (8; 6), and that HaShem will bring The B’nei Yisrael into Eretz Yisrael, a land full of blessing. (8; 7 – 9) Once HaShem has provided all of these blessings for us and we eat of the food that He has blessed us with, we will bless HaShem, which, as we learn in maseches B’rachos (15a) refers to Birchas HaMazon (the prayer recited after eating bread).
We are then warned to not forget HaShem by not following the mitzvos of The Torah. (Devarim: 8; 11) The Torah then informs us how that one can forget HaShem by becoming wealthy (8; 12 – 13) and then becoming haughty, as we learn:
“And your heart shall become haughty and you shall forget HaShem, your G-d, Who took you out from the Land of Egypt, from the House of Servitude.” (Devarim: 8; 14)
We then learn again about how HaShem miraculously provided us with nourishment in the Sinai Desert and how we were provided with water in the arid Sinai Desert – “where there wasn’t water”, and that HaShem protected us from the dangerous snakes and scorpions that inhabited the desert. (Devarim: 8; 15 – 16) Nevertheless, even in light of all of this, the haughty person forgets HaShem and rather says in his heart, “…my strength and the power of my hand has acquired all of this wealth for me.” (Devarim: 8; 17) We are then instructed to remember that all of our possessions come to us through the blessing that HaShem gives us the ability to acquire those possessions and that wealth. (Devarim: 8; 18)
From the above we can learn of the severity of the sin of haughtiness, for it causes a person to even forget about HaShem and all of the miraculous things He has done for us and that all of our wealth comes about through the blessing that HaShem bestows upon us. By forgetting HaShem, the person can easily come to stop following The Torah. From here we see that the sin of haughtiness is so severe, one of the reasons being that it can lead one to dissacociate himself from HaShem and His Torah.
 The “SMa”G” is the “Sefer Mitzvos Gedolos”. The prohibition of haughtiness is the 64th prohibition discussed.
 The entire section in this section of the gemara that discusses the severity of the sin of haughtiness, states as follows:
“Rabbi Yochanan said in the name of Rabbi Shimon ben Yochai: ‘Every person who possesses haughtiness of spirit is considered as if he worships idols, [for] it is written over here [in sefer “Mishlei”], “Everyone who is haughty of heart is an abomination – toavas – of HaShem…” (Mishlei: 16; 5) and it is written over there [in sefer “Devarim” concerning idols], “And you shall not bring an abomination – toeivah – into your house…” (Devarim: 7; 26) Rabbi Yochanan himself said [concerning the severity of the sin of haughtiness], “[One who is haughty is considered] as if he has denied The Essence (i.e. HaShem), as it says, “And your heart shall become haughty and you shall forget HaShem, your G-d...” (Devarim: 8; 14) Rabbi Chama the son of Chanina said, [one who is haughty is considered] as if he had sexual relations [from among] all of the forbidden types of relationships, [for] it is written over here [in “Mishlei”], “All of those who are haughty of heart are abominable – toavas – to HaShem…” (Mishlei: 16; 5), and it is written over there [in sefer “Vayikra”], “For all of these [sexual] abominations – toeivos – [were performed by the people [who dwelled in] the Land prior to you, and the Land became impure.]” (Vayikra: 18; 27) Ula said, [one who is haughty is considered] as if he has built an idolatrous altar (bamah), as it says [in sefer “Yishayahu”], “Stop yourselves from [associating with] the person who has a soul in his nostril, for of what – va’meh – במה – importance is he?” (Yishayahu: 2; 22) Do not read [the word as] “va’meh”, [rather read it as] “bamah”.” (Sotah, 4b)
The Chofetz Chaim quotes the Zohar on Parshas “Titzaveh” (Volume 2; 182a) (See the fifth day of Shevat) that the person with “a soul in his nostril” refers to those people who have rejected The Torah life and instead perform evil. As we have learned above in note 1, as quoted in The Torah, one who becomes haughty can come to forget HaShem and reject The Torah. We learn from the pasuk from sefer “Yishayahu” quoted in the gemara, that a person should not associate with the person who has rejected The Torah, as The Zohar warns. This is the person who, due to his haughtiness has adopted an evil lifestyle in the place of living in accordance with The Torah. It is considered as if, due to his rejection of HaShem and his evil lifestyle, as if he has built an idolatrous altar and such a person must be avoided.
 The entire passage from maseches “Sukkah” (29b) concerning loss of wealth as a consequence of haughtiness, states as as follows:
“Rav said, ‘The property of homeowners goes down the drain on account of [the following] four things: 1) For withholding the wage of a hired worker, 2) for robbing the wage of a hired worker, 3) on account of removing the yoke from upon their necks and placing it on their fellow [people], 4) on account of haughtiness of spirit, and haughtiness of spirit is equivalent to all of them.
However, concerning the humble, it is written [in “Tehillim”], “And the humble shall inherit the Land and they shall delight on an abundance of peace.” (Tehillim: 37; 11)”
The MaHaRSh”A explains that the haughty leaders will expect their fellows to take upon themselves the yoke of leadership in their place. The MaHaRSh”A also notes that the individual performs the first three of the aforementioned sins as he is haughty.
 The passage in maseches “Sotah” (5a), concerning the haughty person being diminished from his stature of prominence, states as follows:
“Rav Avira expounded [concerning those who are haughty]. Sometimes [this teaching is quoted] in the name of Rav Ashi, and sometimes [it is quoted] in the name of Rav Ami. [The teaching states as follows]:
‘Every person who possesses haughtiness of spirit, will eventually be diminished [from their prominence], as it says, “His loftiness shall be diminished…” (Iyov: 24; 24) Perhaps you will say that [this haughty person will continue] to exist in the world, [therefore] the pasuk comes to teach us, “…and he is not [in existence]…” (Iyov: 24; 24) If [this haughty person] will return [from being haughty by performing teshuvah], he will pass away at his designated time like our forefather Avraham, as it says, “…and [if] he shall make himself lowly like everyone – ka’kol, he will [pass away as have the righteous ones]…” (Iyov: 24; 24), just as was the case concerning Avraham, Yitzchak, and Ya’akov, concering whom it is written, “ba’kol – with everything” (B’reishis: 24; 1), [concerning Avraham], “mi’kol – from everything” (B’reishis: 27; 33), [by Yitzchak, and] “kol – everything” (B’reishis: 33; 11), [concerning Ya’akov. However, if the haughty person does not humble himself and repent from his haughty nature, then the following from sefer “Iyov” is written concerning him]: “…and he shall be cut down like the head of a sheaf.” (Iyov: 24; 24) What does [the pasuk mean when it states] “like the head of a sheaf”? Rav Huna and Rav Chisda [both explained the meaning of this phrase], one said ‘like the awn (i.e. on the top) of the sheaf’, and one said ‘like the sheaf itself’. The explanation of the one who said ‘like the awn of the sheaf’ makes sense. However, according to the one who said ‘like the sheaf itself’, [then] what is [the meaning of that which is written], “and as the head of the sheaf”? Rav Asi said, and similarly it was taught in the Academy of Rabbi Yishmael [as follows]: “[The above] is comparable to a person who enters into his field, he gathers the highest [sheaves].””
RaSh”I explains that the person who enters his field will gather the sheaves whose tops are the highest, and therefore the heads of those sheaves are above the other sheaves. Similarly, the haughty person who does not perform teshuvah and remains haughty could die an untimely death.
 The passage from the gemara (Sotah, 5a), states as follows:
“Rabbi Elazar said, ‘[Concerning] every person who possesses haughtiness of spirit, it is fitting to cut him down like an asheirah tree (i.e. a tree that was regularly used for idolatrous purposes), [for] it is written over here [in sefer “Yishayahu”, “…and those who are lofty of stature are cut down – g’du’eem - גְּדוּעִים…” (Yishayahu: 10; 33), and it is written over there [in parshas “Eikev”], “…and their asheirah trees shall be cut down – t’gadei’oon - תְּגַדֵּעוּן…”’ (Devarim: 7; 5) Rabbi Elazar also said, ‘Every person who possesses haughtiness of spirit, his dust will not be moved [at the time of the Resurrection of the Dead], as it says [in sefer “Yishayahu”], “…awaken and be mirthful, those who dwell in the dust…” (Yishayahu: 26; 19), it is not written “those who lie in the dust” – “שכבי בעפר”, rather [it is written] “dwellers of the dust” – “שכני עפר”, [this refers to] one who is made into a neighbor – שכן – of the dust in his lifetime [by being lowly of spirit, the opposite of haughtiness – RaSh”I].’ (RaSh”I – This teaches that only some people will be resurrected at the time of The Resurrection of the Dead.) Rabbi Elazar also said, ‘Every person who possesses haughtiness of spirit, The Shechinah laments over him, as it says [in “Tehillim”], “…and [concerning] the haughty one, the [Shechinah] is broken in mourning over him.” (Tehillim: 138; 6)’ Rav Avira, and some say Rabbi Elazar, expounded [as follows]: ‘Come and see that the behavior of flesh-and-blood is not like the behavior of The Holy One, Blessed is He, the behavior of flesh-and-blood is that the haughty person sees the [other] haughty person, [however] the haughty person does not see the lowly person. However, this is not the behavior of The Holy One, Blessed is He, [for] He is raised up and He sees the lowly, as it says [in “Tehillim”], “For HaShem is lofty and He shall see the lowly…” (Tehillim: 138; 6)’ Rav Chisda, and some say Mar Ukva, said [the following concerning the haughty individuals]: ‘Concerning every person who possesses haughtiness of spirit, The Holy One, Blessed is He, said, ‘I and he are not able to [both] dwell in the world’, as it says [in “Tehillim”], “[Concerning] one who slanders his fellow stealthily, I shall cut him off, I cannot bear he – oso – אוֹתוֹ – who is haughty and covetous.” (Tehillim: 101; 5) Do not read [the word] as “אוֹתוֹ” – “him”, but [rather as] “אִתּוֹ” – I cannot bear [to dwell] “with him”.’ Some teach [this pasuk] in reference to habitual speakers of Lashon HaRa, as it says, “[Concerning] one who slanders his fellow stealthily, I shall cut him off…” (Tehillim: 101; 5) (Sotah, 5a)