Look to the left of the construction worker sitting on the rotating donut to see a grab-able explosive crate. Grab this crate and fly into the wall in front of you, and super-ooch over the train tracks towards the cop car. There is a police man and a girl wearing a bikini, bomb her with this crate 5 times (after each successful bombing, press R1 to reset and Select to reset the level) in order to unlock Demolition. This is just like how you unlock Ed the Cow.