Rand Paul is libertarian-spirited if not a philosophical libertarian and calls himself a limited government constitutionalist. Whatever he is, he's a breath of fresh air in a stale party. Republicans like George Will and Michael Steele are distancing themselves from Paul, which, although disappointing, is not surprising.
The neo-cons don't like his non-intervention stance. Basically, the Republican Party bosses and flunkies don't like libertarianism in any form. This makes it more likely that a viable third party will form in the future, perhaps more than one new party will becoe viable. The two party lock on politics is becoming weaker as the two parties continue to represent a status quo hardly anyone trusts.
The elections this year will be interesting, but I'm not so sure now that much will change. The State has become too powerful and it's not certain the public can maintain opositional pressure and overcome the media and the government offensive actions to destroy all opposition to the status quo.
Most libertarians who uphold the libertarian position will be marginalized as extremists and racists -- opposition to any big government entitlement program will be framed as racist motivated. Cokie Roberts called Rand Paul's comments on private property rights racist views, and many in the media make the implicaton. Calling for the elimination of public education will be seen as racist -- reform of the welfare state will be framed as racist. In other words, the status quo is being protected and the march to insolvency continues.