A lot more risk involved in the ARM to save a percentage point, even if you get one with a longer fix. The longer fix just makes it that much harder to predict where interest rates will be when it's adjustment time.
For example, right now, a 10/6 ARM is roughly 4.75%. A 30-year fixed is roughly 5.5%.
On a $200,000 30-year loan, after ten years, the ARM will have paid $86,638 in interest. The fixed will have paid $101,348, a difference of $14,709. Over ten years, that's an average of $1,470 per year more.
But if, rates continue to climb as you suggest, then when the ARM starts adjusting every 6 months, it gets really ugly really fast. Let's say in the first year the ARM adjusts to 6.5% The fixed rate is paying $7,561 in interest in year 11 of the mortgage. The ARM (which is now effectively a 20-year mortgage on $160,418 at 6.5% that adjusts every six months) is now paying $10,308. So in the first year of adjustment, the fixed rate has already made up almost $3,000 of the difference in the two loans. The fixed will catch up in just a few years and the ARM will be left in the dust. And that's with only one adjustment upward of 1%.
What if the rates are at 8%-10% by year 10? You may decide to refinance into a fixed rate (that would probably still be around 7% at best) and you're still ending up worse than the fixed. Plus you lose the closing costs for refinancing, which will also eat into any savings you had.
Unless you plan to aggressively pay off the house (or sell it) prior to the expiration of the fixed part of the ARM, there's just realistically no reason to get an ARM over a fixed, pretty much ever.