Manchester, NH—Rep. Ron Paul, trim and dapper in a charcoal suit, sits in a classroom at the local Boys and Girls Club, surrounded by a dozen high school and college students looking to quiz him about his presidential candidacy. Questions range from the vague (Is the constitutional balance of power working?) to the specific (Should we recall our troops from Germany and Japan?). No matter: To all, the Texas congressman serves up his patented, unified philosophy of get-the-government-off-our-backs. Many of the students nod in appreciation.

Then a young man named Jonathan asks about trade with China, and things get complicated. Fast.

Paul begins in his usual crotchety-but-common-sense manner: “We don’t have authority over China, and a lot of people say, ‘Oh, those dirty Chinese, we ought to double, triple the tariffs on their goods.’” But next thing you know, he’s off on a tear about how this all boils down to an absurd and unconstitutional reliance on paper money that lends itself to currency wars, inflation, market bubbles, and global economic instability.

Most of the kids now sport blank stares, leaving it to the center’s director to observe, “You’re talking about a return to the gold standard.”

Recognizing the ticklishness of this particular economic idea, Paul begins to tap dance. Fast.

“Well, that’s what the constitution gives us,” he begins gingerly. Then he’s off again, talking in circles about the possibility of there being other commodities that people might prefer, and really you could consider any number of things, though probably you’d want to avoid taxing silver dollars, and, really, the constitution already provides for this sort of system, and, yeah, ok, maybe he is talking about reinstating the gold standard after all.

Everyone is the room looks relieved when the candidate finally falls quiet, and a young woman named Marina asks him about gay marriage.

These are dizzying days for Ron Paul. For over three decades now, the GOP gadfly has railed against government: prophesying economic doom, denouncing the military industrial complex and the Federal Reserve, advocating an end to broadly popular programs including Social Security, Medicare, and college Pell grants. While conservatives such as Newt Gingrich and Rick Perry want to tame or shrink government, Paul wants to chop the monster’s head off, drive a stake through its heart, and burn the corpse in a trash bin.

Perhaps unsurprisingly, the congressman’s radical platform has enjoyed mostly niche appeal. During his 2008 presidential run, Paul’s anti-war libertarianism drew a core of die-hard devotees (many of them young). But despite the Paulites’ passion, their candidate never made it above 10 percent in the Iowa polls, and topped out at 14 percent in New Hampshire.

What a difference four years make. A week out from the Iowa caucuses, Paul’s message seems to be resonating with a disaffected public that feels our nation is deeply troubled and in need of the blow-it-all-up gospel Paul preaches. “As he likes to say, ‘The world has come to him,’” enthuses Phil Nazzaro, a town councilman from nearby Newmarket helping Team Paul reach out to veterans.

Paul has cracked 20 percent in Iowa, fueling much chatter among the media—and hand-wringing among the Republican establishment—that he might just win the January 3 contest, giving him a full head of steam going into New Hampshire, where he is also above 20 percent. What this could do to the already volatile Republican race has political watchers of all stripes chewing their cuticles.

But the transition from fringe curiosity to mainstream contender is a tricky one, especially for a candidate whose appeal has been based on his unconventionality. As everyone’s favorite cranky uncle, Paul has long gotten away with stuff that would have destroyed more “normal” pols—like, say, allowing racist and anti-Semitic newsletters to be sent out in his name. Now, as the full scrutiny of the political press corps bears down upon him, the congressman finds himself struggling at times to do all the things that regular candidates are expected to do.

Most benignly, the grip-and-grin retail politics called for in small states like New Hampshire don’t seem a natural fit for the good doctor. Paul doesn’t work a room so much as buzz it, grasping every hand as efficiently as possible then getting the heck out. With guidance from aides, he will freeze for the requisite photo ops. But he is not one to linger and chew the fat. During a drop-in at the Just Doo It hair salon in Exeter, Paul was stopped by one patron, a still-undecided voter named Annette, who asked if he had time for a question. “As long as it’s a quick one,” he cautioned, beginning to inch toward the exit even as he answered her.

Paul doesn’t seem actively put out by such encounters, or even awkward and out of place a la Mitt Romney. It’s more that the whole process seems to have rendered him vaguely distracted, maybe even a little dazed.

Far more jarring have been Paul’s responses—or lack thereof—to the newfound interest in newsletters published under his name in the 1970s, 80s, and 90s that peddled blatantly racist sentiments. (For instance, commentary on the 1992 Los Angeles riots included this gem: “Order was only restored in L.A. when it came time for the blacks to pick up their welfare checks.”) The first big fumble was the congressman’s televised run-in with—or more precisely his walk-out on—CNN’s Gloria Borger during a December 21 sit-down. Rather than having worked out a response aimed at defusing the controversy—which, let’s face it, was sure to erupt at some point—Paul turned snippy with Borger, scolded her for “pestering” him, and ultimately unclipped his mic and left the set mid-interview.

This, of course, only fueled the fire, leading to more coverage in both the old and new media. And still Team Paul flounders, choosing alternatingly to ignore the subject and to attack anyone who raises it. Most recently, when former Paul staffer Eric Dondero addressed the spiraling accusations this week, insisting that Paul isn’t racist or anti-Semitic but is anti-Israel and a foreign-policy loony, the campaign immediately trashed Dondero as a bitter, untrustworthy malcontent with a rusty axe to grind.

The New York Times, meanwhile, asked Paul to respond to its report that his campaign receives support from white supremacists, militia groups, and anti-Semitic organizations. While the congressman said he rejected such extremist views, he declined to reject their support.

Despite such tics and stumbles, Paul seems serious about making the transition from curiosity to contender. He’s a compelling public speaker and—his clash with Borger notwithstanding—he generally has a sense of the areas where he must tread lightly in order to counter the wild-eyed portraits being painted of him. Avoiding the words “gold standard” is only part of the picture. (Paul’s preferred term is “commodities standard.”) At two separate stops in New Hampshire last week, the candidate was asked to address criticisms of his aggressively anti-interventionist foreign policy. (His gripes about U.S. military meddling abroad and calls to cut the Pentagon’s budget are more than a little controversial among Republicans.) Both times, he went on at length about how people tar him as “an isolationist,” when, in reality, he’s the one who wants to do away with sanctions and embargos and usher in a golden era of free trade and diplomacy. “I’m the one who wants to trade with Cuba!” he exclaims in exasperation. Once again, you could see heads bobbing thoughtfully.

That evening, Paul spoke to a full house at the Exeter Town Hall. The crowd was a mix of fans, of voters still trying to make up their minds, and even of people who didn’t much care for Paul but who saw it as their duty to give every candidate a hearing. Racing enthusiast Bruce Allen counted himself in that third category. A middle-aged bear of a man wearing a large belt buckle that scrolled “Merry Christmas” in red lights across a black screen, Allen initially proclaimed Paul a “nut” and “definitely not the kind of guy you’d want as president.” He told me he’d mostly come “for the entertainment value.”

As the session wore on, however, Allen began joining in the applause as Paul explained, over and over, that the country must free itself from the toxic embrace of government. Repeal the Patriot Act! Stop policing the world! Abolish the Department of Education! End all bailouts!

Allen’s final verdict: Not all that crazy. “I only disagreed with one thing he said,” he shrugged, referring to Paul’s proposal to let young people opt out of paying Medicare taxes.

Of course, there’s a big gap between not-all-that-crazy and being a candidate who can have a lasting impact on the race. Where Paul winds up on that spectrum will depend on his ability to strike a delicate balance between cult hero and mainstream contender—fast.