Can my boss tell me that he's allowed to be rude and say whatever he wants because he writes the checks?

He can say that, but that's not necessarily true. There are a number of laws regarding discrimination, harassment and the workplace environment that can be violated through speach. If you believe that you are subject to harrassment, discrimination or other workplace related issues, you should contact an attorney to give you an idea of your options.

Yes, an employer--whether of an independent contractor (including a subcontractor) or an employee--may be as rude as he or she likes, say anything he or she wants to say, etc. The law does not require respect or professionalism from employers.  The one exception is, an employer may not abuse, harass, or discriminate against an employee on certain specific protected bases, such as due to religion, race, sex, disability, age over 40 (or in some states, sexual orientation, national origin, or family status).