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August is a classic antagonist. He's the straight-up villain of Water for Elephants. He's a wife-beater, an animal abuser, and a downright cruel individual. At numerous points in the book, people try to excuse August's behavior by saying that he's a paranoid schizophrenic. But Jacob doesn't believe there's excuse for his behavior.
One of the things that makes August such a good villain is that he's not bad all the time. He's got a charming side, too, which is one of the reasons he's able to fool people for so long. He can be really sweet, even sexy, and if you're on his good side, he'll treat you royally.
Think of the smart things August tells Jacob about the nature of the circus, about how they're participating in something that turns out to be nothing but "illusion" (7.204). When things are going well at the show, August treats Marlena and Jacob to dinner and gives them both expensive presents: a diamond necklace and a gold watch. Fancy shmancy.
But wait. When he's in a bad mood, it's a totally different story. At another dinner, August accuses Marlena and Jacob of committing adultery and savagely beats them both. Ironically, that dinner is a surprise party for August to celebrate the team's achievements with Rosie. But the celebration isn't on August's terms, and he doesn't even believe it's real; he treats it like a cover-up for a sordid affair. (He's partly right, but that doesn't excuse his behavior one bit.)
Jacob is one of the few people who seems to be able to look at August from both sides:
It's hard to reconcile this August with the other one, and to be honest I don't try very hard. I've seen flashes of this August before – this brightness, this conviviality, this generosity of spirit – but I know what he's capable of, and I won't forget it. The others can believe what they like, but I don't believe for a second that this is the real August and the other an aberration. And yet I can see how they might be fooled […] (17.117)
Jacob tells us it's important to remember that no matter how "bright" and "convivial" August can seem, that doesn't change the depths to which he can sink. He knows the cruel August is the "real" one and the nice one is the "aberration" or exception, but he worries that other people think the opposite. It's possible that someone like Al might buy into that, but we know that Marlena (and probably most of the other circus folk) don't. Thank goodness.
Jacob does admit that his passionate interest in Marlena could be influencing his interpretation of August. But there's no denying the facts, which support Jacob's diagnosis that the "real" August is the one who abuses animals and people and who is a dangerous live wire. Think of what Marlena tells Jacob toward the end of the novel about all the terrible things August has done: how he's forced untrained people to feed the lions (one died as a result), how he trapped her in a loveless marriage, and how people he dislikes have a way of mysteriously disappearing in the night. All signs point to bad guy.
Indeed, August is possibly not just a jerk but a murderer. Just ask Walter, who tells Jacob that August is "the meanest son of a b**** [he's] ever met" (11.208). Walter straight-up tells Jacob that if he doesn't watch it around August, "[he's] going to find [himself] dead. Red-lighted, if [he's] lucky, and probably off a trestle" (11.210). Other people at the circus try to warn Jacob about August, too; Diamond Joe tells him, "Look, I'm only going to say this once. August's a funny one, and I don't mean funny ha-ha. You be careful. He doesn't like no one questioning his authority. And he has his moments, if you know what I mean" (6.231). The lore around the circus certainly supports the fact that August is capable of murder, or at least organizing one. It's no surprise that many dislike and even fear him.
Lots of individuals are prepared to kill August if they need to. After August hits Marlena, both she and Jacob say out loud that another such beating would result in his death. "If he does it again, I swear to God I'll kill him," Jacob tells Marlena, and she responds, "If he does it again, you won't have to" (18.205-206), the implication being that she'd do it herself.
Despite that, Jacob takes it upon himself to kill August and almost succeeds, arriving at his bedside with knife in hand while August is sleeping. It's a total Hamlet and Claudius moment. In the Shakespeare play, Hamlet becomes concerned that his uncle, Claudius, murdered his father. He spends most of the play freaking out about whether or not to take revenge. In one scene he comes across his uncle at a vulnerable moment: Claudius appears to be praying (emphasis on "appears to be") and is defenseless. But Hamlet ultimately decides not to kill Claudius while he was praying because he's totally defenseless and it means Claudius would go straight to heaven.
Similarly, Jacob can't kill a sleeping, innocent guy, no matter how evil he might be. In his sleep, August is as innocent as Claudius appears to be in prayer. The fact is, neither one is actually innocent, but neither Jacob nor Hamlet can go through with premeditated murder.
Fortunately for Jacob, Rosie has no problem punishing August for his actions. While Jacob agonizes over whether or not to kill August, Rosie just picks up her stake and slices through his head the minute she gets the opportunity. While it's a terrible way to go, you'd find several characters who would say that August deserved all he had coming to him.