Overall, the economy lost jobs in August. However, this was mostly due to the continued winding down of temporary census jobs. Private-sector jobs increased slightly.

Nonfarm payroll employment changed little (-54,000) in August, and the unem-ployment rate was about unchanged at 9.6 percent, the U.S. Bureau of Labor Statistics reported today. Government employment fell, as 114,000 temporary workers hired for the decennial census completed their work. Private-sector payroll employment continued to trend up modestly (+67,000).

These weak job numbers are not at all unexpected. In fact, back in June 2009, former McCain adviser Mark Zandi predicted that the economy would start losing jobs right about now [via Paul Krugman]. 

Why? Because the stimulus was simply too small. By nearly every estimate (and not just by liberal economists), the stimulus has been a success, but unfortunately it didn’t go far enough. It saved an estimated 3 million jobs, but given the magnitude of the economic crisis, that was not nearly enough. 

The stimulus did exactly what it was expected to. Paul Krugman showed today that economists who warned the stimulus would be too small turned out to be exactly correct. There were also economists who predicted the stimulus would fail because it would temporarily increase the deficit; Krugman showed why they have been proven wrong.

The problem was that the administration was far too cautious. They need to lose that caution. More stimulus would prevent a double-dip recession.