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(Adds poll in third paragraph that shows Paul candidacy would hurt a more viable GOP nominee.)

NEW YORK (

TheStreet

) -- President Barack Obama has a new best friend. His name is Ron Paul.

The Texas congressman has astounded pundits with a trait that has eluded him during his many presidential campaigns: electability. A

new poll

shows Paul leading the pack in Iowa, with a double-digit lead over Mitt Romney among voters under 45.

Paul is doing so well that he may pull off the most considerable feat of his career:

engineering the re-election of Barack Obama

. As a matter of fact, if the Democrats play their cards right, they can exploit the Ron Paul Factor into a sweeping victory in congressional and state contests as well. All they have to do is be the anti-Paul. He is that toxic.

The reason is that Ron Paul is not a conservative. He is a far-right radical, with extreme views on the economy and the role of government that are far outside the American mainstream. At the same time, he has isolationist views on foreign policy that appeal to some on the left who wouldn't care for the rest of his platform -- if they bothered to find out what it is.

More than any other candidate for president, he presents in vivid fashion the moral choice facing voters in 2012. It's a question of fundamental values, one that will decide the role of government in society for years to come.

Despite the faux-populist appeal and foreign policy views that have suckered some progressives -- do they know that Paul is firmly anti-abortion and feels that

life starts at conception

? -- he is the corporate-Wall-Street-far-right enemy of everything Obama stands for. Paul embodies the vision of government as evil, taxation as looting, and free-market capitalism as the moral ideal of the nation, in contrast to the traditional liberal view of regulations as helpful, taxation as a method of achieving income equality, and capitalism as requiring control.

Paul has developed an almost cult-like following because he is different from the rest of the pack. He is a rarity: an intellectual in a presidential race dominated by buffoons and cynical know-nothings like the former candidates Cain and Trump. He's a man of consistency amid flip-floppers. He's not especially telegenic, but it doesn't matter. He combines the appealing folksiness of Ronald Reagan with the low-key intellect, and popularity with the young, of Eugene McCarthy in 1968.

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Beneath the humble, appealing veneer is a rigid ideologue. A President Paul would be Ebenezer Scrooge before he met the Ghost of Christmas Past, dismantling social programs that care for the poor. He'd put the New Deal on full-throttle reverse. His policies

more clearly favor the 1%

than any other GOP candidate for president. Yet his anti-interventionist stance in foreign policy has substantial appeal to many on the left.

Free-market economics -- rigid adherence to laissez-faire capitalism, monetary policy based on the gold standard and immense cuts in government spending -- is the meat and potatoes of Paul's appeal. And that's where he is the Democrats' best friend. While not a Randian by any means -- he is too much of a maverick for that -- he was heavily influenced by the Ayn Rand ideology, which he followed closely when he was younger, and many of his views track hers and those of Austrian economists.

As Paul Krugman

pointed out in the New York Times

the other day, "Austrians see 'fiat money,' money that is just printed without being backed by gold, as the root of all economic evil, which means that they fiercely oppose the kind of monetary expansion

Milton Friedman claimed could have prevented the Great Depression." If Paul's monetary policies ever took effect, he concluded, "Great Depression, here we come."

For the Republicans, Ron Paul means "defeat, here we come." There are two possible scenarios, neither of them boding well for the GOP:

* Paul wins. Hey, what does Paul Krugman know? He's only got the Nobel Prize. Besides, as Thomas Frank pointed out in his 2004 book,

What's the Matter With Kansas

, Americans are champions when it comes to voting against their own economic interests. Paul's election is the least likely scenario, but it seems more likely than ever, given his great polling numbers in Iowa.

Remember that at this time four years ago, it wasn't considered likely that Obama would win. If Paul does win, the moral choice would be so clear that I wouldn't be surprised if Obama wins sizable numbers of moderate Republicans. And the Jewish vote, which Republicans are courting so avidly? Forget about it. Obama is widely viewed as not being a friend of Israel, but Paul is perceived as being positively hostile. That won't do him much good with evangelical Christians either.

*Paul loses. This is, of course, more likely -- for now. Then what? Well, we're left with a whole lot of unhappy Ron Paul supporters. When asked about a possible third-party run, Paul has said he has no plans to do so -- but he

hasn't closed the door to the idea entirely.

. There's a good chance for a third-party run. The man obviously loves running, and

the idea of a third-party candidacy is being pushed

by some conservative commentators. That would, of course, draw votes away from whoever the Republicans elect, and pretty much guarantee Obama's reelection.

If he doesn't run as a third-party candidate, then we're left with a campaign between a radicalized Republican nominee and Obama. As for Paul, his supporters might be so teed off that they'll sit this one out. I'm not terribly sure that Paul would campaign too vigorously for a Newt Gingrich or Mitt Romney candidacy, especially since their foreign policy views are so completely at odds with his own. He might come in with the kind of half-hearted endorsement that McCarthy eventually gave to Hubert Humphrey after failing to stand on the platform with him at the Democratic convention.

All in all, I'd say that Barack Obama breaks into one of his trademark smiles whenever he reads about Ron Paul surging ahead in the polls. He knows a friend when he sees one. And believe me, Barack Obama sure needs a friend.

Gary Weiss' forthcoming book,

AYN RAND NATION: The Hidden Struggle for America's Soul

, will be published by St. Martin's Press on February 28, 2012. Follow him on Twitter:

@gary_weiss

.

Gary Weiss has covered Wall Street wrongdoing for almost a quarter century. His coverage of stock fraud at BusinessWeek won many awards, and included a cover story, �The Mob on Wall Street,� which exposed mob infiltration of brokerages. He uncovered the Salomon Brothers bond-trading scandal, and wrote extensively on the dangers posed by hedge funds, Internet fraud and out-of-control leverage. He was a contributing editor at Conde Nast Porfolio, writing about the people most intimately involved in the financial crisis, from Timothy Geithner to Bernard Madoff. His book "Born to Steal" (Warner Books: 2003), described the Mafia's takeover of brokerage houses in the 1990s. "Wall Street Versus America" (Portfolio: 2006) was an account of investor rip-offs. He blogs at garyweiss.blogspot.com.