He knows exactly how they work.
Let's say $XXX,XXX,XXX in the budget is allotted for infrastructure. That number never changes. If representatives don't claim the funds for their districts, then the Executive branch gets to spend it. So a rep from one district says, "I need $X,XXX,XXX for my district to help re-build after the hurricane" and congress either approves it or does not. It doesn't change the amount spent on infrastructure. The fact is that Ron Paul does not increase the budget or spending, on top of that he votes against the spending in the first place. The problem is that people don't listen, I mean, he could explain it better, but why should he have to say anything more than that?
The real problem is that people are unfamiliar with Ron Paul and how principled he is.