His response is pretty typical for a dog that responds poorly to having been punished when caught in the act of doing something wrong. Amy, I understand that you haven't physically hit him…but if he was hit, or really intimdated at his first home for things like getting into the garbage, anything and everything that surrounded those events will be imprinted in his memory. So the act of you coming in and finding him in the middle of something he shouldn't be doing, may cause him to freak out because he anticipates being punished. If you yell, or show signs of anger that may make him remember punishment. So at this point, the only thing you can do is try to reverse that association. Try to change your POV so that he can do nothing "wrong"...set him up so there is no way he can get to a garbage, or get into any trouble. If he does (which he will) you chalk it up to your mistake. For the moment, I would try to never use another angry word with him...even if you are gritting your teeth, smiling at the little $h!^, you say 'what a naughty, naughty boy, come over here so we can do a training session'...and the minute he turns away from the trouble, without anger, he gets huge rewards. Yes, you will feel like you are bribing him (and you are, for the moment)...and yes, it will feel very un-natural for you...but as I said before you cannot "correct" him into behaving at this point...he does not have that type of temperament.
Check out the book "Click to Calm" by Emma Parsons
http://www.amazon.com/Click-Calm-Healing-Aggressive-Clicker/dp/1890948209