http://www.millerwelds.com/om/o1308n_mil.pdf
I don't think you should lube that shaft. I think it would only solve one problem momentarily and create many more. All that lube would just collect more stuff to bind up the spool. I think you need to take it off and clean it out real good. (When you are welding all that gets magnetized and metallic particles stick to everything.) Put it back and set the tension to where you only have a slight drag on the spool to keep the wire from birdnesting when you let go of the trigger. Look on page 12 of the pdf. file, it shows you the correct way to tension the spool.
Hope this helps,