A Q&A with Sen. Kelly Loeffler on her unlikely path to Washington—and what she’s planning to do there
How’s this for the rarest of résumés for a new U.S. senator: an outsider who hasn’t run for office since the eighth grade, grew up farming corn and tending cattle, spent a career building a $50 billion trading empire, and got the nod over opposition from President Donald Trump?
The unorthodox Republican newcomer is Kelly Loeffler, 49, whom Georgia Gov. Brian Kemp chose in early November to replace Sen. Johnny Isakson, the three-term veteran who retired at year’s end because of ill health. At more than six feet in heels, with a cascading blonde mane, one of only 26 women in the U.S. Senate, and a clear outsider from the business world, she’s bound to stand out.
Loeffler was a controversial choice. Trump pressed Kemp on three occasions to name Georgia Rep. Doug Collins, a fierce Trump defender in the House impeachment hearings. Kemp arranged for Trump to meet the charismatic Loeffler (pronounced “Leffler”) at a secret meeting, but apparently she didn’t win over the POTUS, who kept championing Collins. Ivanka Trump and her husband, Jared Kushner, also lobbied for the congressman. Republican hard-liners groused that Loeffler had donated cash to the Romney campaign in 2012 but none to Trump in 2016, and they suspected she was a closet liberal who wouldn’t promote the President’s agenda with the zeal of a Collins.
Kemp bucked the establishment onslaught, reportedly reckoning that Loeffler could win over suburban women, a group that’s critical to winning statewide races and has been trending Democratic. The appointment was as historic as it was bold. It’s been 98 years since Georgia had a female senator: In 1922, Rebecca Felton of Georgia was appointed as the first woman to ever hold a Senate seat, but she served a token term of just one day. Loeffler needs to mount a series of winning campaigns to keep her seat, a tough road for someone who’s never before courted voters. In November she’ll run in a special election to fill the last two years of Isakson’s term, and if she wins, run again in 2022.
Though Loeffler lacks a legislative record to lure voters, she can highlight a hugely successful business career that shows a knack for tackling real-world problems. Until her appointment, she was mainly known as co-owner of the WNBA’s Atlanta Dream and for flirting with a Senate run in 2014. She’s already polishing her profile as an entrepreneur who spent her career creating jobs and profits, not chasing a job inside the Beltway. As this writer has witnessed in covering Loeffler, she displays a folksy, common touch that masks a backbone of steel. Her first job was weeding soybean fields, and punching a time card, on her family’s farm in rural Illinois. Each morning her mother wrote down the trading prices of corn and soybeans, instilling in her daughter a lifeline fascination with commodity markets.
After gaining an MBA from Chicago’s DePaul University, Loeffler worked as a trainee at Toyota and a securities analyst at a Wall Street firm, then joined a private equity shop in Texas. In 2002 her boss announced that he was leaving for a tiny power exchange in Atlanta that was a pioneer in trading natural-gas futures. As she watched Enron collapse, Loeffler viewed big opportunities by achieving what Enron had set out to do: creating an efficient, electronic marketplace for buying and selling natural gas and other energy products. “When I see a house burning down, I like to run in,” she told me in a 2018 interview. In 2002, Loeffler took a flier by hopping to the Atlanta startup as one of the first 100 employees.
The venture was Intercontinental Exchange (ICE), the energy trading network that Jeff Sprecher had bought from an Atlanta utility for a token $1 and was rapidly building. Loeffler quickly became a top lieutenant to Sprecher, eventually rising to head of marketing, investor relations, and communications. In 2004, Loeffler and Sprecher wed. “Our honeymoon in St. Nevis was the only time in 10 years we took an entire week off,” Loeffler told me. With Loeffler riding shotgun, Sprecher built ICE from a startup to a colossus, purchasing the International Petroleum Exchange (now ICE Futures Europe), the New York Board of Trade (ICE Futures U.S.), and in 2013 purchased NYSE Euronext for $9.75 billion to capture the New York Stock Exchange. Following each deal, Sprecher transformed rowdy open-outcry markets into streamlined electronic exchanges. Today, ICE boasts a $53 billion market cap and ranks as the world’s second-largest owner of exchanges, after the CME Group. ICE’s success could make Loeffler the richest senator; she and her huband’s combined net worth stands at over $500 million in ICE stock alone.
In mid-2018, Loeffler took a new role as CEO of Bakkt, a venture majority-owned by ICE that aims at democratizing cryptocurrencies. Shortly before Loeffler departed for the Senate, Bakkt won a license to become the first federally regulated exchange for trading Bitcoin futures. It’s now striving for the goal Loeffler always envisioned: revolutionizing retail payments. In concert with a group of partners that includes Starbucks, Bakkt aims to enable customers to pay with Bitcoin at the checkout counter using their cell phones, streamlining today’s convoluted process and radically reducing fees. It’s not clear if the gambit will work, but the mission reflects Loeffler’s big ambitions.
While Sprecher is a voluble raconteur—his sister Karen, a filmmaker, described him to me as “a know-it-all who knows it all”—Loeffler is surprisingly soft-spoken. It’s quality-against-type that she cultivates. “I may not be the loudest voice in the room, but you don’t have to be shrill to be tough,” she said in her announcement speech upon being appointed. It took little time for Loeffler to showcase her down-home side. In a Twitter post on Jan. 11, she enthused over “how impressed I was” by a plant producing Kia autos that she toured in West Point, a hamlet in far western Georgia on the Chattahoochee River. The photo shows Loeffler trading grins with a Kia worker, the pair posing in front of her newly purchased Kia Telluride. The Kia will be the Loeffler campaign car, she announced. “Look forward to driving Georgia-made vehicle throughout the Peach State!” proclaimed the tweet.
Loeffler will be vulnerable to rookie mistakes that could hurt her chances in the elections soon to come. But from this writer’s experience, she’s a natural as much at ease chatting up farmers at a state fair as courting wealthy donors at a ballroom gala. Although her politics are mostly a blank slate, she is anything but an empty vessel. But filling her agenda with other legislators’ initiatives doesn’t sound like Kelly Loeffler. She’s more likely to find fresh causes to make her own.
This conversation, conducted on Jan. 15, edited and condensed for clarity, is one of the first occasions she’s detailed what she’ll do as Georgia’s unlikely new senator.
Have you ever run for office in your life?
I ran for student council president in eighth grade, and I ran against two of my best friends. Early polling where there would be 90 votes for the whole junior high indicated that I would be in first. And I helped the number three candidate with his campaign signs. So I did end up winning. The polling back then was accurate. I won, and that is when I thought I’d go out on top.
In terms of helping Georgia, talk about what you envision.
Our governor Brian Kemp has done a tremendous job setting the tone there and will continue to make sure that we have a low tax environment, that we’re providing innovative ways for providing for education and health care challenges. And then our state’s number one infrastructure project is the Savanah Harbor expansion project. It’s already a leading port in the United States. We’ll make it bigger to increase the commerce that comes into the United States through that port. I was in Savanah about three weeks ago and was able to tour it and see the immense scale of it. It’s a multi-modal network of the port connecting the trains, trucking. This is the lifeblood of commerce: shipping product as we increase manufacturing in the United States.
I also got to see the other end of that supply chain. I had the good fortune of being able to get to West Point, Georgia, before I came to Washington, to visit Kia Motors Manufacturing Group, KMMG. Kia is a South Korean manufacturer, but they’ve invested well over $1 billion in the state of Georgia and brought the first auto manufacturing plant to Georgia. That plant employs at any one time between 3,000 to 4,000 employees around the clock running three shifts, but it’s also spawned the growth of the automotive supply chain in Georgia, where we been able to employ another 10,000 Georgians. It just shows you how one investment is amplified throughout the state.
I came out of the automotive industry. My first job out of college was with Toyota, and I was a management trainee. I worked my way through the field organizations in different cities across the United States, so I know firsthand how competitive the automobile industry is and how vital it is to our manufacturing. We talked a lot about the agricultural communities in Georgia, and those agricultural communities are now being supported by expansion of manufacturing.
Are there advantages to being an entrepreneurial outsider?
Being an outsider and having that perspective of what it’s like to sign a paycheck, what it’s like to hire, and what it’s like to have to fire someone in a downturn gives you a sense of the real economy very quickly. And for me, having operated in a global business and working side by side with our management team when I was at ICE, I saw firsthand the risks that companies have to take: They have to raise capital, they have to have benefit plans, they have to hire and train employees, think about the investments that they make and the competitive landscape.
What lessons did you learn from growing up on a farm?
My parents required that I fill out a time card so that I could understand what it took to earn a dollar, and then I would go to the mall on the weekend, and I could see how quickly I would spend it. It was a great lesson. My mom recently sent me some of those time cards, and it instilled a sense of pride in hard work, results, the dignity in work, and the desire to learn and grow. Besides my work ethic, what I took away from the farm was an appreciation of markets and free market economies on a global scale, because farmers are really at the middle of a market economy. When I was young my mom and my grandmother would write corn and soybeans futures prices on the Formica countertop. I always say I learned commodities futures before I learned math.
Neither political party is addressing the debt and deficits situation. We’re now booking trillion-dollar deficits. Is there anything you’d like to do about this?
I do think it’s an important issue, particularly for future generations. We have to be responsible. Fiscal discipline is entirely necessary. It’s practiced in the private sector. It’s needed in the public sector, and as I learn, I’ll be applying that lens.
I grew up in the era of Ronald Reagan. He was President when I graduated from junior high and high school. During the Reagan era was when I really started paying attention to business. In fact, my mom bought me The Art of the Deal when I was going into the 11th or 12th grade. I was buying investment banking books because I knew that I wanted to work in markets. In my farm community, there weren’t very many business people, so it seemed very glamorous to me.
But this idea of fiscal discipline is important. I tend to be more of Reagan supply-sider-type discipline, but I’m looking to make sure we make smart decisions for the long term. That leads to what we saw with the China trade agreement. Sometimes you have to make some decisions near term that are difficult but are very important for the long-term result.
Do you consider yourself a free trader?
I’m a fair trader. Free trade is important from an economic perspective, but fair trade is vitally important, particularly when you think about where the value in economies is so influenced by intellectual property and tariffs on important goods like agriculture. It has to be fair. Anything that levels the playing field is the right direction.
Let’s move on to impeachment. Do you think the Republicans should agree to call new witnesses?
My first position is that this impeachment exercise is completely political. But as a Republican caucus in the Senate, we’ve agreed on how to proceed at the outset, which would be consistent with how the Clinton impeachment played out. But we’ve made no decisions beyond that because we need to hear the opening statements and the questions before anything else is decided.
Would you be open to witnesses?
I wouldn’t venture forward on that one. I would say this is our chance to actually have a fair trial, to have due process that was not afforded to the President in the House, and that’s really going to be the standard. So we’ll deal with the witness question when we get there.
Given your experience running Bakkt, are there ways the fintech revolution can be aided by changes in regulation?
In fintech, a lot of folks in that industry come from the technology world and don’t have financial services experience and don’t understand the financial regulation rules, be it Treasury, the SEC. Our view was that we’d work within the existing framework of federal regulation versus having it change to suit the needs of innovation.
We’ve seen over the last three to four decades as technology has really come into financial services that rules have evolved to accommodate electronic trading, for example. We did not seek any changes; we met the existing regulations. That said, there are times when innovation comes about, and there needs to be an accommodation. We didn’t require that for our product. But if you think about how much banking has changed, how much trading has changed, that markets have changed, there have been changes in federal rules to accommodate innovation and those rules have been made in Congress, but they’re not always necessary.
What’s your view of the “Squad” and the socialist movement?
Socialism does not work. Socialism is the biggest threat to our country that we have today. That’s a big part of why I’m here. Our free market capitalism in the United States has been the single best thing for the entire world, not just for our country. It’s why more people want to come to our country than want to leave. It’s why people come here to be educated. It’s why the American dream exists.
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