That is a final desperate act. His army is splitting into factions, his fighters are flying his jets into foreign countries and surrendering his weaponry. He has lost control of parts of Libya. His own diplomats in the UN and in the US are calling this a genocide and asking for intervention. He can't even trust his own security forces. He is pretty close to fucked.
Anyway, these recent events are a lesson to totalitarianism leaders across the world. People will only deal with being stepped on for so long. If the only way you can hold you country together is through fear, then what do you do now? Popular uprisings have successfully overthrown two dictatorships and are in the midst of taking down a third. There is just not any fear to keep the little people from proving that they are more powerful than their governments.
I have great hopes for the future. This is truly an exciting time to live.
Check out these articles on the subject if you are interested:
Obama faces pressure to intervene in Libya
Gadhafi vows to ‘cleanse’ Libya or die trying
In Libya, increasingly divergent views of Gaddafi