>In a market were the job market is higher than the number of people looking for jobs, your logic is okay. But as soon as it's the other way around, as it is now, you don't have a chance of finding a job if you don't lower your rates. There will be at least one other consultant as skilled as you who will lower his rates and get the job.

...assuming the client focuses only on that.

For example, I've been involved in projects where large amounts of expenses have been in effect (7 digits) because the company put together one or multiple teams (where projects failed, stopped, etc.) less experienced that the team I ended up with. And, other related stories like that also apply to other projects I've been involved with. So, sad but true, when the client realizes that, they'll say "Well, now it's time to things the proper way!". :)