Thursday, April 21, 2005
John Harrington
1001 2nd Street
Suite 325
Napa, CA 94559

Dear Mr. Harrington:

I am writing in response to your letter dated April 18, 2005 regarding the privatization of
Social Security.

At Charles Schwab, we work with millions of investors each year helping them plan for
and reach their financial goals. From that experience we know that retirement security is
the top financial priority for most Americans. Assuring that Social Security remains
viable for current and future generations of American retirees is a common national
objective and should be one of today's most important long-term goals for policy-makers
and the public, regardless of political affiliation. We have encouraged and will continue
to support an open discussion about ways to address Social Security's long-term strength
and viability. We're hopeful the nation can reach a bipartisan compromise to assure
Social Security's long-term viability. We believe that Americans deserve a system that
works and provides a stable and predictable future for them. At this time, The Charles
Schwab Corporation is not an advocate of any specific political approach related to
addressing Social Security.

If you have additional comments or concerns please do not hesitate to contact me at 1-


Kathy Priest

Chairman's Division

Monday, April 18, 2005
Charles Schwab
The Charles Schwab Corporation
101 Montgomery Street
San Francisco, CA 94104

Re: Social Security Privatization

Dear Mr. Schwab:

On February 1, 2005 I sent you a letter regarding Schwab’s support of the plan to privatize Social Security. Although I received a phone call informing me that the letter had been received, I have yet to receive a written response. Considering the current media furor over this issue and the ensuing public outcry, it would seem obvious that a formal response is warranted. Our clients, who are uniformly opposed to the privatization of Social Security, have been contacting me out of concern that Schwab is supporting this dangerous, foolish and self-serving proposal.

As a member of the Alliance for Worker Retirement Security, a group created specifically to fight for privatization, Schwab’s public claims of being neutral simply do not ring true. Furthermore, John L. Sweeney, president of the AFL-CIO, claims that an executive vice-president of Charles Schwab Corp., William L. Atwell, is a “principal proponent” of private accounts on the Securities Industry Association board. This also calls Schwab’s neutrality into question, as does the participation of Schwab officials in White House meetings focused on the privatization of Social Security.

I have worked with your firm as a client and stockholder for many years and hope this does not jeopardize our business relationship. On the other hand, if your position of supporting the privatization of Social Security is unalterable, our continued relationship is indeed threatened.

I would appreciate a prompt response and look forward to hearing from you.


John Harrington

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