> have value, and that value is preserved through scarcity

Adam Smith, Benjamin Franklin, Thomad Malthus, David Ricardo, Jean-Baptiste Say, Thomas Malthus, John Stuart Mill etc. and all the early economists did not believe value was preserved through scarcity.

People tried to change this idea in the 19th century, but in the early 1950s the idea that value was preserved through scarcity was only held widely in the USA, and perhaps in some quarters in Western Europe.

Nowadays things are contradictory. Contradictory in the sense that the establishment speaks about government and free market in a certain way, then flips to the total opposite idea and demands banks be bailed out by taxpayers, then flips back to what they were originally saying once that is done.

The establishment economists say value is through scarcity. Then they demand that mp3's, movies etc. not be "pirated" because "artists deserve the fruit of their labors" and the value they imputed to these mp3's, movies etc. But how can that be if value is derived through scarcity? If things are write once, read many, then there is no unfairness going on if no one buys movies and songs and "pirates" them.

The mainstream economists say value is derived through scarcity, but then, when things can be reproduced digitially with no more scarcity, they try to impose the old legal system on things - the legal system which always more-or-less acknowledged that value came from labor time, whether or not the idealogues acknowledged things as such.

This is also why Bitcoins are as worthless as tulips were in 1637 Holland ( http://en.wikipedia.org/wiki/Tulip_mania ), or bum real estate projects in 2008, or Pets.com and Webvan stock in 2000 etc. The Mt. Gox collapse and such is just the heralding of the inevitable collapse of the worth of Bitcoins.

In science, facts, such as say the inevitable collapse as Bitcoin, or the contradiction of where mp3's derive their value, and so forth, change established theory. But as who gets a bigger piece of the big pie is not a scientific endeavor, it's a struggle with lots of propaganda and such. If scientists predicted something, and then the evidence showed them wrong, they would change their theories. The inevitable collapse of Bitcoin will not change its slick huckster's propaganda one iota. They'll just sucker you into buying into their next MLM scheme. How long until it happens? However long Dutch tulip bulbs, or the housing bubble, or the dot-com bubble went on should be a clue. As Keynes said, markets can remain irrational longer than you can remain solvent. But those who want to understand how the world really works, will look at the inevitable crash of Bitcoin, meaning when they are worth not $630 or so each, but 63 cents each, or less - those who want to understand how the world works will see when that happens and will reconsider whether value comes from scarcity or not. Most won't. The ones who hype it today will have other reasons for why that collapse, which today they say will never happen, will have had happened. The propaganda will go on. But those who want to understand the world can take that time to reconsider things. Even though the discourse will be dominated even then by the phonies and hucksters who were just proven to be frauds. That day will come in the next few years, as it is impossible for Bitcoins to retain value due to "scarcity".