This is only a hypothesis and would appreciate comments.
Suppose you have captured a large town in a hostile area (or built up one over the years) and a large faction army has taken umbrage and started a siege. Worse still, your reinforcements are not going to get there for a few turns and the 'wall' is a palisade/ log wall, your garrison is heavily outnumbered and you can see no hope of surviving the onslaught. You have no diplomats available to try and bribe the attacker.
Well what you do is destroy everything you can before going out for death and glory:
1) You get all that money back in your account to spend on the war.
2) The opposing faction loses the capability to generate quality troops in the town.
3) The opposing faction loses the port facility to build ships.
4) There will be a collapse in public order (and possibly health)
5) The army that captures the town is going to have its foot nailed there to try and keep the garrison effect at 80%
6) The faction will probably have to devote resources to rebuild the town - meaning it is spending money on poor replacements
A word of warning: when I tried this, my forces managed to win!