Steve Forbes has just endorsed Rand Paul for Senate. Rand Paul is the son of famous libertarian icon and former presidential candidate Rep. Ron Paul (R TX-14). The Kentucky Senate race is shaping up to be the most interesting of 2010. This may not be the closest or most important race, but it could definitely become the most entertaining to watch.

Rand Paul is running in the Republican primary against State Treasurer Secretary of State Trey Grayson. Grayson is Senate Minority Leader Mitch McConnell’s hand picked successor to Jim Bunning. Despite not having the support of the local or national Republican Party machinery, Rand Paul has managed to tap into a large network of supporters and raise $1.7 million for the race so far. Paul is running on a strong anti-tax, anti-bank bailout, anti-Patriot Act, small government platform. Polling as been light this early in the race, but a SurveyUSA poll from two weeks ago had Paul ahead of Grayson, 35% to 32%.

The Kentucky Senate Republican primary should be a fascinating case study in the power of the local and national party establishments in determining the outcome of important primary races. Kentucky’s Mitch McConnell is arguably the most important elected Republican right now, and he clearly favors Grayson. If his preferred candidate can’t win a primary race in his own state, it will say a lot about the waning power of political party establishments in this new era.

It will be interested to see how much time, money, and energy McConnell and the national Republican Party think they need to invest in Grayson. And, with Rand Paul well positioned to ride the wave of right-wing populist anger against the bank bailouts, it might also be a sign of how much real political clout the “tea party” movement has accumulated.