Economic woes:
1) Too much money spent on weapons over consumer goods
2) In his move to try to combat alcohol abuse, Gorbachev shot himself in the foot by limiting vodka (and iirc most alcoholic) production, thus denying a large amount of state revenues from the taxation of alcohol (consumption did not decrease due to the reactionary increase in black market alcohol). This increased economic problems.
Political change:
1) In order to try to give the economy a boost, Gorbachev started opening up the Soviet Union both politically and economically by giving more rights to people to express their views as well as giving some people the right to start their own capatilist-stle businesses
2) Along with greater expression, mistakes that were made by the government were actually admitted to, such as the Chernobl disaster
3) For the first time since the October revolution, the people stood up against the coup d'etat. What sealed the fate of the Soviet Union was the fact that the military backed the protesters.
Obviously there is more to it than this, but these are some of issues involved.