The warm welcome that Senator Rand Paul (R-Ky.) received from an audience of mostly young Americans at the University of California, Berkeley, last week should send a shiver down the spines of Democrats.

Paul was in the Bay Area ostensibly to complain about the National Security Agency’s snooping on Americans. He described “an intelligence community drunk with power, unrepentant and uninclined to relinquish power.” The crowd applauded as he said, “What you do on your cell phone is none of their damned business.”

His real purpose, however, was to demonstrate to Republican primary voters that he alone is capable of extending the party’s reach beyond its current narrow boundaries. He likened the Republicans to a tarnished brand that had finally turned itself around. “Remember when Domino’s finally admitted they had bad crust?” he said. “Think Republican Party. Admit it. Bad crust. We need a different kind of party.”

By appearing in jeans and cowboy boots on the Berkeley campus, scene of the high point of the 1960s student protests and the epicenter of California liberalism, the closet libertarian did more than survive 40 minutes in the liberal lion’s den. He showed that his anti-domestic spying message rings true with young progressive Americans who are inclined to vote Democrat.

Not long ago, Paul reminded Republicans that they cannot win elections if they pursue lines of argument that seem irrelevant to the majority of Americans. He acknowledged that the GOP is the incredible shrinking party, the last bastion of the old white men who have resented every change in American society in the last 50 years — from the twist to Twitter.

“The Republican Party is not going to give up on having quite a few people who do believe in traditional marriage,” he said. “But the Republican Party also has to find a place for young people and others who don’t want to be festooned by those issues.”

This is not the first time Paul put distance between himself and others who are pursuing the GOP presidential nomination. Most wannabes pandering to the Tea Party offer impractical ideas about reducing the size of the state, cutting public spending and paying down the national debt. It is mostly waffle, unsupported by a comprehensive plan for what to trim and who will be hurt by the cuts.

Paul, meanwhile, has gone his own way. He is proposing a daring and plausible scheme to encourage economic growth and reduce chronic unemployment in sinking cities like Detroit. “The answer to poverty and unemployment is not another government stimulus,” he told the Detroit Economic Club. “It is simply leaving more money in the hands of those who earn it.”

Inspired by an idea that was advocated by the original conservative economic thinker, the late Representative Jack Kemp, who inspired President Ronald Reagan to make deep tax cuts, Paul’s plan is to slash federal taxes on individuals and companies in targeted areas — such as Detroit and his home state of Kentucky — that would benefit from a surge in spending to increase local demand.

Directing a flailing economy from on high is hardly the hands-off approach many free-market conservatives who believe communism starts with street lights feel comfortable with. The standard conservative line is to get government off people’s backs. Not to have Washington pick and choose which areas are a suitable case for a tax cut.

But Paul is no obvious conservative. Cutting taxes deliberately to boost demand may have been adopted by conservatives as a popular means of buying off voters while enforcing quid pro quo spending cuts. But the principle of cutting taxes to stimulate demand is pure Keynes.

Paul’s dirigisme sits oddly with both his claim to be a true conservative and his libertarianism. It is widely thought that when it comes to policy, Paul shares many views of his father, Ron Paul, the former congressman from Texas, Libertarian Party presidential candidate and perennial GOP presidential hopeful.

When asked to explain the difference between his father’s political philosophy and his own, he refuses to answer. If he is serious about running in 2016, however, the senator will soon have to spell out exactly what he stands for. So far, each Paul initiative has indeed proven more libertarian than conservative.

Insisting that, unlike most of his rivals, he does not claim Reagan’s mantle, Paul’s foreign policy ideas remain largely unexplained. He stresses that “defense of the country is the primary constitutional role of the federal government,” though he has yet to explain whether he would withdraw the vast numbers of U.S. armed forces deployed around the world — as his father has long advocated. When it comes to Ukraine, like President Barack Obama, Paul backs diplomacy over military intervention.

Another recent Paul move that raised eyebrows among traditional conservatives was an initiative to reduce sentences for drug offenders. Though he is suing the federal government in a class action suit over NSA’s mass surveillance of Americans’ emails, he is now happily working with Attorney General Eric Holder in a measure to abandon mandatory minimum sentences for certain minor drug crimes.

“Mandatory minimums are costly, unfair and do not make our country safer,” Rand wrote in an oped with Senator Patrick Leahy (D-Vt.), chairman of the Senate Judiciary Committee. “They have played a major role in overcrowding our prisons and have confined us to an unsustainable and irresponsible economic path.”

The measure has broad bipartisan support.

Compromise with Democrats is considered a mortal sin to Tea Party types. Yet in recent straw polls, such as the Conservative Political Action Committee beauty contest this month, Paul comes out on top. If he can hold onto the Tea Party, attract the young libertarian-minded voters that were so enthused by his father’s presidential run in 2012 and reach out to young liberals who are appalled by the NSA’s domestic spying, Paul might forge a formidable if unlikely coalition of voters where liberalism and libertarianism meet.

Nonetheless, Paul remains an odd candidate. He appears resistant to all attempts to package him or make him media friendly — which is refreshing. His television interviews are curt to the point of ill manners, even when being quizzed by the GOP mouthpiece Fox News. His hairline is a Donald Trump-like mystery. He is profoundly deaf and wears hearing aids in each ear.

Could Paul win the presidency? It’s too early to tell. But liberal Democrats should watch carefully how like the pied piper he is prizing away a key young demographic. In a race between Paul and Secretary of State Hillary Clinton, Paul would appear original, interesting, youthful and fresh.

That may not be enough to overcome the mighty Clinton machine. But Paul would give her a good run for her money. More than most of the current GOP field — which is riven between the unelectable and the unspeakable.

Nicholas Wapshott is the author of Keynes Hayek: The Clash That Defined Modern Economics.Read extracts here.

PHOTO (TOP): Senator Rand Paul (R-Ky.) speaks to reporters during the 14th day of the partial government shut down in Washington, October 14, 2013. REUTERS/Joshua Roberts

PHOTO (INSERT 1): Republican presidential candidate Representative Ron Paul speaks to supporters as his son, Senator Rand Paul, (L) applauds at his Iowa Caucus night rally in Ankeny, Iowa, January 3, 2012. REUTERS/Jim Young

PHOTO (INSERT 2): Senator Rand Paul of Kentucky speaks at the Conservative Political Action Conference (CPAC) at National Harbor, Maryland March 14, 2013. REUTERS/Kevin Lamarque