Two timely policy questions—”make or buy?” and “can public-sector employees innovate?” – are conveyed by the two seemingly prosaic stamps that make up today’s #stampoftheday offerings.

The stamps are a 6-cent stamp picturing James Garfield issued on July 18, 1894 and a 1-cent stamp picturing Benjamin Franklin issued on July 18, 1924. In earlier posts, I’ve written about stamps that featured both men – one issued in 1882, about a year after Garfield was assassinated and the other, featuring Franklin, that was the first U.S. postage stamp, issued in 1847. What’s notable about today’s stamps, then, isn’t who’s on them but how they were produced.

The Garfield stamp was the first stamp to be produced by the government’s Bureau of Engraving and Printing (BEP) rather than by private printers hired by the Post Office. BEP had been created in 1862 when, for the first, time the government used paper money. That same year, President Lincoln created the Internal Revenue Service to collect taxes imposed on a variety of Items such as medicine, perfume, cosmetics, alcohol, and tobacco. The IRS provided stamps to show that required taxes had been paid. The BEP began by printing only the beer and cigar stamps, but by 1878, nearly all revenue stamps were produced by them.
In 1894, with the approval of the secretary of the Treasury, the BEP submitted a bid for the contract to print the new series of postage stamps. The bid was almost $7,000 less than the lowest bid submitted by the three private companies also competing for the contract. Despite loud protests that the Bureau was not capable of producing the stamps, the BEP won the contract. (Notice this: sometimes the public sector can do things cheaper than the private sector)

Soon, the BEP began producing most US postage stamps and did so for about 75 years. And, it seems to me, that from the 1930s until at least the late 1950 or early 1960s, they did so with an notable attention to design and detail, often creating beautiful and lasting images of iconic, and not-so-iconics Americans and places.

BEP’s monopoly status began to change in the late 1960s when the US Post Office began issuing contracts to private security printers. BEP stamp production dropped significantly, to less than 50% of all stamps in 1997. The last BEP-produced stamp was printed on June 10, 2005. Designs today, of course, are different than in the past, and, like the printing process, were increasingly outsourced.

So the Garfield stamp opens up a discussion about what the government should do directly and what it should hire others to do. The Franklin stamp suggests a related question: can public-sector employees produce notable innovations?
The Franklin stamp was the first to make use of a notable iteration of a series of innovations in the machines used to print stamps that were developed by Benjamin Rollins Stickney, who began worked as a mechanic at BEP in 1897. Stickney apparently was really good. By 1908, he had invented more than a dozen machines and processes that greatly improved BEP’s operations. That year, newly appointed BEP tasked Stickney with solving a problem that had stymied everyone since the bureau began printing postage stamps in 1894: how to develop an efficient method of dry printing. As noted in Scientific American magazine, “Hundreds of thousands of dollars have been spent by private concerns in trying to overcome this seemingly unsurmountable obstacle. Some of the most skilled mechanical minds and the greatest geniuses in the world have tried to overcome this difficulty and failed.”

Within two years, Stickney believed he had the solution, but the bureau didn’t have the money to test his ideas in action. Ralph sought financial assistance from the Post Office Department, and a prototype was built. Other department directors that used the bureau’s services observed the new machine in action, and all were stunned because it worked perfectly, and was far faster and much more efficient than the previous equipment.

With his invention, Stickney eliminated 23 steps from the overall process, which now took only 9 hours from start to finish. Millions more stamps could be produced daily, and at a calculated cost savings of 57 percent. The single machine was put into use, and more were ordered. Stickney got a promotion and a raise to about $5,000 (about $70,000 in today’s dollars) but he didn’t reap the significant financial rewards that he might have gotten in the private sector particularly as other countries began adopting his machines.

Then, without any warning, on March 31, 1922, President Warren Harding, fired the bureau’s director and 28 other top officials, including Stickney. Harding would only say they were all let go “for the good of the service.” Apparently the firings stemmed from cutbacks and cost-cutting measures that had led to job losses. Disgruntled layoff victims claimed there had been dual printings of certain securities, all to the financial benefit of upper-level employees. About a year later, in February 1923, Harding, who apparently concluded he had been misled, issued another executive order, restoring all the former employees who had been wronged. Though some had died or moved on to other employment, many, including Stickney returned.

Stickney restarted work on yet another improvement to his printing system and leaders of the Post Office agreed to use it, on an experimental basis for a few stamps, starting with the 1-cent Franklin stamp. Over the next two years, the department decided to use the new press to print other regular stamps. (There was a problem with cancellations that had to be worked out but that’s a tale for another post.)

Ironically, on August 2, 1923, about two weeks after the Franklin stamp was issued, Harding (whose administration was becoming embroiled in a host of scandals) died. The Postmaster General ordered a special commemorative stamp issued to honor him. The mourning stamp was rushed into production in less than a month. They were so popular that Stickney’s machines were pressed into service to meet the demand for stamps that honored the man who had unjustly fired him.
So, in addition to being interesting stories, these two stamps illustrate two important policy questions that are particularly salient during the current pandemic. Consider, for example, this week’s controversy about whether hospitals should report COVID-related data to the CDC, a public entity, or to a private contractor hired by the U.S. Department of Health and Human Services. The argument for privatization typically has turned on whether a private entity can provide a service more efficiently or effectively. But, sometimes things are so important that we really want to know that they are being done by public employees and public entities. Or, as Jack Donahue, one of my mentors at the Kennedy School of Government, once put it, “who should paint the White House?” (That is, would it be appropriate to hire a private firm to undertake such a public undertaking? Or is painting the White House a uniquely public responsibility, particularly if the occupant isn’t enormously controversial?)
The second question, which literally surrounded me when I first started working at the Kennedy School and had an office in the midst of several people working for the Innovations in American Government Program, was whether and how public sector officials can be encouraged to act in innovative ways. (One key obstacle is that since the cost of making a mistake often is greater than the rewards you get from a breakthrough, public employees might tend to be very risk adverse, which is not conducive to innovation).

And yet, whether it was Stickney – who retired in 1930 and moved back to the Adirondacks where lived until his death in 1946 – or if it’s Anthony Fauci today, American government (at all levels) is full of people who were willing to take key risks to achieve notable, sometimes seemingly insurmountable, goals. So the question is how do we find and encourage people, including allowing them to occasionally make some mistakes, which sometimes requires be willing to take the heat for them rather than blaming them when things don’t work out.

Given our current situation, it’s going to be critical that we find good answers to both of the questions posed by two (more-or-less) century-old stamps.

Be well, stay safe, fight for justice and work for peace.