Why do people do this to their trees?
I've seen this practice done to everything from Live oaks to Bradford pears, but nothing as severe and widespread as with Crepe myrtles.
Some might call it severe pruning but I call it butchering. The sad thing is it's become a yearly ritual around the South to remove over half the tree every winter. There are several articles online which refer to the Crepe myrtle mutilation as "Crepe murder" and that's not far from the truth, considering the damage it does to the trees.
I genuinely don't know why people do this to Crepe myrtles. It doesn't improve the health of the tree, it stunts the growth, it leaves scars, etc. And yet driving around this time of year you'll see this horrifying sight all over the place in the Southern US. All this for a tree which, if left alone, is one of the most beautifully-shaped flowering trees in the world.
I'd guess most people who do this don't realize the extent of the consequences, or don't know what they're missing by cutting the tree back so much.