My JR bit my son.

I have a 7 mo. old nuetered male that bit my son tonight. The dog was napping and my son sat down next him to pet and cuddle with the dog and my son put his face next to the dog's, and the dog bit my son's nose and upper lip. Both bled pretty good. The dog has growled and bared his teeth in the past under the same circumstances with this child but never bitten. Including this incident, the dog was scolded firmly and put in time out. (The dog is walking around with his tail between his legs right now as if he knows he's done something horribly wrong.) I thought I was dealing with this aggression appropriately because the dog has never had this reaction to anyone else in the home, including my younger son. Infact, a two year old little girl was climbing on him and pulling on him earlier today and there was not one sign of aggression towards the little girl.

Do I need to get rid of this dog? Why is he aggresive to this child that dearly loves him and treats him so well? The only explanation I can think of is that this dog beleives our family is his pack and that my son is lower on the pecking oder then him. How do I correct this before something far worse happens to my son or another child in my home?