"Permanent workers get job security!"
I'm going to have to disagree with you on this one. Overall I've had more job security as a consultant that I ever had as a permie. Coupled with the problem that as a permie I *thought* I had job security - when the hammer falls with little notice you aren't prepared for it.
Now, as a contractor, I have 6 months money in the bank and I am always trying to improve my skill base (not just technical) to ensure I remain competitive (which was harder to do in a permanent position as it's easy to forget you're living on a knife edge).
The worst type risks are the ones you haven't accounted for. Once you know the risks, and account for them, then I find contracting a lot more secure (yes, partly because I have to work harder to make sure I am - but that's what helps me keep my edge).