Julian Sanchez and Dave Weigel report for Reason that it was primarily Lew Rockwell, probably working with a few associates, also named. They also report that the racist writings in the Ron Paul newsletters were part of a larger strategy:
Rockwell explained the thrust of the idea in a 1990 Liberty essay entitled “The Case for Paleo-Libertarianism.” To Rockwell, the LP was a “party of the stoned,” a halfway house for libertines that had to be “de-loused.” To grow, the movement had to embrace older conservative values. “State-enforced segregation,” Rockwell wrote, “was wrong, but so is State-enforced integration. State-enforced segregation was not wrong because separateness is wrong, however. Wishing to associate with members of one’s own race, nationality, religion, class, sex, or even political party is a natural and normal human impulse.”The most detailed description of the strategy came in an essay Rothbard wrote for the January 1992 Rothbard-Rockwell Report, titled “Right-Wing Populism: A Strategy for the Paleo Movement.” Lamenting that mainstream intellectuals and opinion leaders were too invested in the status quo to be brought around to a libertarian view, Rothbard pointed to David Duke and Joseph McCarthy as models for an “Outreach to the Rednecks,” which would fashion a broad libertarian/paleoconservative coalition by targeting the disaffected working and middle classes. (Duke, a former Klansman, was discussed in strikingly similar terms in a 1990 Ron Paul Political Report.) These groups could be mobilized to oppose an expansive state, Rothbard posited, by exposing an “unholy alliance of ‘corporate liberal’ Big Business and media elites, who, through big government, have privileged and caused to rise up a parasitic Underclass, who, among them all, are looting and oppressing the bulk of the middle and working classes in America.” […]The presidential campaign Rothbard and Rockwell supported in 1988 was Ron Paul’s run on the Libertarian Party ticket. In 1992, they were again ready to back Paul, until Pat Buchanan convinced the obstetrician to withdraw and back his conservative challenge to then-president Bush. “We have a dream,” Rockwell wrote in that same January 1992 edition of RRR, “and perhaps someday it will come to pass. (Hell, if ‘Dr.’ King can have a dream, why can’t we?) Our dream is that, one day, we Buchananites can present Mr. and Mrs. America, and all the liberal and conservative and centrist elites, with a dramatic choice….We can say: ‘Look, gang: you have a choice, it’s either Pat Buchanan or David Duke.’”
Sanchez and Weigel go on to note that Paul has shifted gears well away from this political strategy:
But perhaps the best refutation of the old approach is not the absence of race-baiting rhetoric from its progenitors, but the success of the 2008 Ron Paul phenomenon. The man who was once the Great Paleolibertarian Hope has built a broad base of enthusiastic supporters without resorting to venomous rhetoric or coded racism. He has stuck stubbornly to the issues of sound money, “humble foreign policy,” and shrinking the state. He wraps up his speeches with a three-part paean to individualism: “I don’t want to run your life,” “I don’t want to run the economy,” and “I don’t want to run the world.” He talks about the disproportionate effect of the drug war on African-Americans, and appeared at a September 2007 Republican debate on black issues that was boycotted by the then-frontrunners. All this and more have brought him $30 million-plus from more than 100,000 donors; thousands of campaign volunteers, and the largest rallies he’s ever spoken to, including a crowd of almost 5,000 in Philadelphia.
This is all true enough as far as the strategic direction of the libertarian movement goes. Then again, as best I can tell Paul’s anti-immigration views have about as much appeal as his libertarian ones. Most of all, though, I think this dog won’t hunt: “Ron Paul may not be a racist, but he became complicit in a strategy of pandering to racists — and taking ‘moral responsibility’ for that now means more than just uttering the phrase.” That’s right on moral responsibility, but I don’t think it’s right on racism. To have the sort of indifference to the well-being and sentiments of black people that you’d have to have to be complicit in “a strategy of pandering to racists” in the way that Paul was, just is racism in my view.