I want to change my password policy in local security policy but it seems to be locked? Any ideas how I can unlock it? And I am logged on as administrator......

You are going to local security policy/account policies and password policy? You should be able to access as admin. Did you devalue the administator account? In other words did you make changes in the security policies that reduce the admin account rights to that of a user?

I did nothing to devalue my admin account.... My security settings are locked, account policies, and local policies........

All the signs of a standard user not an admin account. Under this account can you create a new administrative account? If standard user you can't.