How Gorbachev demolished the USSR with reckless reforms 1

Gorbachev was not stymied by the powerful Soviet politburo but rather, he botched perestroika due to his own lingering ideological belief in Leninist struggle and the power of a revolutionary proletariat.

Gorbachev complained that he lacked power at the highest levels and was undermined by influential forces to successfully transition the Soviet Union to a more market economy. He claimed to be fearful of meeting the same demise as Khruschev.  His complaints about a restive populist and urban elites dissenting, resulting in backlash, seem hollow given the vast propaganda power and control structures of the Soviet state; e.g. via Gorbachev's memoirs:
"As in many other instances, the interests of the nation were sacrificed to the desire to win cheap popularity. Radical newspapers published letters and wrathful diatribes, and in only a few weeks public opinion changed to total rejection of price reform.

Also, “as soon as the bureaucrats and the nomenklatura became confident that economic reform was possible, they understood how they could benefit and they supported it.”

The CIA had a good take at the time. Gorbachev rapidly accomplished a massive restructuring and reduction in force of the bureaucracy following his ascension to General Secretary in 1985. A CIA analysis observed that this appeared to INCREASE not decrease Gorbachev's control; it certainly demonstrated his invulnerability to counter-reform forces:
"The decisive reorganization, the intelligence assessment concluded, “proved that he [Gorbachev] had the political strength to impose radical change on the party apparatus.” It went on to observe that “Gorbachev may hope that the [industrial, energy, and agricultural] commissions [commissars] will facilitate reform of the Soviet system, but his overall goals appear to go far beyond simply creating a new administrative apparatus, extending to reducing party control in general and enhancing his own power.”

The Law on State Enterprises (1987) and the Law on Cooperatives (1988) sought to increase bottom-up autonomy and initiative. Without price reform, neither law could work properly. Gorbachev's refusal to allow more fiscally realistic prices (not even full market pricing), i.e. that better reflected supply and demand, caused enterprises to remain trapped in a command economy. Lacking the authority to set retail prices, enterprises couldn't adapt to changing circumstances, fund capacity expansion, take risks on technological upgrades, and make quality improvements.

"Rather than carefully thinking through the institutional requirements of transition, Gorbachev simply torched existing institutions of party and state in the hope that a new Soviet society would rise from the ashes… Behind this neglect of institutions lay a streak of anarchism. Gorbachev, like Yeltsin, came to accept Karl Marx's assumption that the state does not play a crucial or even useful role in economic performance, that it is parasitic and that planning can be achieved as it withers away. This, combined with an irrational fear of the power of the Soviet bureaucracy, made Gorbachev demolish the power of the state in a misguided attempt to thereby revitalize a stagnant system.”

Minimal price reform occurred prior to 1991. By then, the USSR was falling apart due to the consequences of Gorbachev’s political reforms. Gorbachev DID understand the importance of price reform!  He was paralyzed by his idiosyncratic--and ultimately self-harming--belief that it would undermine the mass enthusiasm of the working class that he deemed even more important to success of perestroika.

Ultimately, Gorbachev was as much as, or more, responsible for the collapse of the Soviet Union as privileged and entrenched bureaucratic interests. A benevolent view is that "leaders misdiagnose problems, or respond to real problems in less than optimal ways", and that Gorbachev's failures were due to the gap between reality and his perception of it. A less benevolent interpretation is that Gorbachev was striving for a Soviet version of market capitalism with Chinese characteristics, with himself in the role that Xi Jin-Ping now occupies.
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Some of the best sections from the article:

*From 1985 to 1989, the USSR went from a balanced budget to a deficit of 10% of Gross National Product. One of Gorbachev's most beneficial initiatives was an anti-alcoholism campaign.
"Finance Minister Boris Gostev said that “losses due to falling oil prices on the world market were 15 billion. From [falling sales of] vodka—also 15 billion.” Combined these two hits to Soviet revenue account for perhaps a third of the 90 billion deficit."

*Regarding Gorbachev's unwillingness to address prices; there was no excuse for the "irrational pricing system" described here, especially not in the carefully controlled economy of the Soviet Union:
"Gorbachev himself refused to raise retail prices, but did increase the wholesale price for grain—not because the “agriculture complex” forced him to, but more because urban citizens’ were complaining about meat consumption levels, while the USSR was so short on grain that it needed to import agricultural product to feed livestock. The pricing system under Gorbachev remained so irrational that it was cheaper for farmers to buy finished bread to feed their farm animals than it was to purchase their own grain."

*Indulgence of well-off urban elites and their consumption preferences:
"Urban consumer subsidies were far larger and more devastating to the budget than just about anything else. Gorbachev and the regime, which still maintained its household registration system limiting internal migration, nurtured a massive urban consumer bias. It was Gorbachev’s revenue cuts combined with an unwillingness to impinge upon this broad group that exploded the budget deficit, not the complexes of entrenched interests... In fact, Gorbachev massively expanded subsidies to them."

*The chickens come home to roost. Social expenditures had been less than 20% of Soviet GNP until 1980. Under Gorbachev, social spending (much due to urban consumer price subsidies) grew the budget with no end in sight. Low and stable consumer prices became illusory:
"...then the economic growth came to an end and the fulfilment of social contract obligations resulted in a rapid increase... to 33.9% of GNP in 1991. Thus the biggest budgetary problem may have been that decades of rhetoric about a proletarian workers paradise actually had an impact.

*The USSR was a welfare state of a peculiar sort.
"Food subsidies were by far the largest component of the Soviet welfare state, dwarfing spending on pensions or education. Through subsidized prices, the government paid nearly one-third of the cost of every loaf of bread, over half the cost of every gallon of milk, two thirds of the cost of butter, and a whopping 72 percent of every kilogram of beef. The main beneficiaries of this spending were not the poor, but the wealthy."