This was part of the Four Pests Campaign, that targeted what Mao considered to be ecological and agricultural pests: rats, mosquitos, flies, and sparrows.

It is one of those things that superficially might make sense to someone. Sparrows, like rats, eat grain. So every grain that is eaten by a sparrow is grain that cannot be eaten by a person. So kill all the sparrows, you get more grain, right? (And hey, who wouldn't like to get rid of mosquitos? I mean, other than spiders and malaria protozoans.)

The problem is, of course, that ecologically this sort of thing has all sorts of unintended side-effects. Sparrows eat more than grain — they also eat lots of insects, insects that themselves eat crops. So instead of decreasing crop pests, they unintentionally increased them. (This is Ecology 101, and was not a new idea at the time of the Four Pests Campaign. Studies of the mutual interdependence of animal populations were already quite common by the 1930s.)

This is the sort of "big idea by fiat" that Mao became famous for. (Stalin did a few similar things as well, but generally were a little less half-cocked looking. Collectivization didn't work, and that led to a lot of famines that killed a lot of people, but it's not in the "melt all of your iron in your backyard to make steel" category of stupid.) It is one of the major issues with the cult of personality that were created during the Mao period. Mao considered himself a "Renaissance man" capable of weighing in on lots of complicated philosophical and scientific subjects, and had the power to put even pretty bad ideas into practice. Questioning the ideas was a good way to get arrested or worse.

This seems particularly endemic to early Communist regimes. Politicized Marxism more or less states that people who have mastered Marxist philosophy are basically the ultimate experts in the world — they understand the "science of history" and thus know how everything fits together. (Lenin and Stalin felt similarly.) It had a number of spectacular failures along these lines, both in the People's Republic of China and in the Soviet Union. The later leaders in both countries took more cautious approaches, relied more on the advice of experts before making sweeping pronouncements of this sort.