magic mouse doesn't scroll when I move my finger up and down or side to side
I fixed it by simply switching the mouse off and on again.
Does the Bluetooth icon in the menu tray have a zigzag line through it indicating there is something wrong with the Bluetooth interface?
I had the same issue of not being able to scroll and noticed that my Bluetooth connection had issues. A restart fixed my Bluetooth connection issue and my scrolling issue.
Also, the Bluetooth software stack can break, reinstalling your OS, applying all updates or upgrading to the latest OS would address that cause of this failure.