One more reader response, this one comes closest to convincing me that I’m a bleeding-heart nanny-state liberal (are there rehab programs for that sort of thing?):

What makes this particular case interesting is that the firefighters were already there, so there was the possibility of an on-the-spot deal being negotiated. What makes it more interesting was that the firefighters had no legal right to negotiate such a deal. Moreover, the homeowner who said he would pay whatever they wanted to put out the fire was not telling the truth.
To see this, suppose the firefighters replied “We are authorized to go ahead and put out the fire, but the cost will be everything you own, including the house.” Do you think he would accept? Of course not. So what he was really willing to offer was to pay reasonable costs. But he already had an opportunity to do the reasonable thing by signing up in advance, and declined. So why should anyone get outraged when he gets what’s coming to him? As far as I can see, the only plausible source of outrage was that he didn’t realize in advance how severe the penalty might be.

One nit to pick: Surely some very broad conception of “reasonableness” is already built into the homeowner’s promise to pay “whatever” it costs.