On taking office in 1985 Mikhail Gorbachev faced one problem more daunting than all others combined. The Soviet economy had been in a period of decline for two decades and was in desperate need of reform. Gorbachev choose to adjust the old system with a period of perestroika or restructuring in the hope of making it more efficient. The country was in desperate need of social and more importantly economic transformation for it was in serious trouble with shortages of even the most basic items like bread. Gorbachev's plan was to introduce policies designed to begin establishing a market economy by encouraging limited private ownership and profitability in Soviet industry and agriculture. Politically Gorbachev wanted to keep the Soviet Union communist at the same time making it a socialist democracy. He also wanted to decentralize the government thus giving more power to the people. Gorbachev's reforms sounded very promising to his people who were searching for any relief from their poverty. These reforms turned out to be anything but the answer to years of disorder and economic decay. They only put the country in a deeper state of turmoil. There are many reasons for Gorbachev's reforms not working. Gorbachev's first major problem was that instead of remaking the Soviet system he merely tried to modernize it and adjust the old one, but it had to many holes for it to possibly be repaired. Instead he should have introduced a totally different system rather than trying to fix the old one. The U.S.S.R.'s second problem was that they failed to reform the relationship with its member republics earlier and shift money from defense in an effort to stabilize the consumer market. This would have allowed billions of dollars to be put into the economy and reestablish it. The third major problem presented to Gorbachev was in opening a free market before constructing a civil society in which the market could safely operate.