A colleague of mine has written a very lengthy FAQ on this issue if you're seriously interested in this.

Abstract:
For 3 decades, several newsletters ran under Paul's name containing fairly conventionalright-wing commentary for the time. Paul personally distanced himself from production and variousghostwriters came and went. For a brief period, lasting from about 1990-94, a relatively small numberof newsletters were released sporadically which contained racially hateful and “homophobic” remarks.This occurred during a time when Paul had relinquished responsibility for the newsletters ‟operation,retired from Congress and an exhausting Presidential campaign, and consigned himself to working full-time as a medical doctor and public speaker, in addition to raising five children. A few objectionable issues managed to leak out under his nose, quite understandably. Paul did not then and does not now possess superhuman powers. The racist comments fly in the face of everything Paul has ever written and said, as many people who know him personally have attested, and he was angry when he learned of them. He didn't issue a full denial in 1996 when it was first brought up only on the (in retrospectquite bad) advice of his campaign staff. He has in the recent past addressed the issue several times publicly, explicitly denying authorship, and there is every reason to believe it and move on.

The rest (22 pages with numerous footnotes) is here: http://www.scribd.com/doc/76280303/PaulNewslettersFaq-Tunk