Sometimes, as a service to a client, working by the hour is necessary to get them out of a bind.
But this is not how you ordinarily conduct business. So the rate you charge should be high because hourly work is distracting you from the profitability of the CONTRACTING business you are engaged in.
High risk/reward contract work has no place for the sure thing of hourly work. If that's what you want, become a labor broker and rent out temporary help.
The game is all about who has the money, and who is at risk.