Why does the AI NEVER annex a city?

Compiled list of reasons they should annex more:

1. If it's a production city, it behooves the AI to manufacture units, especially if their civilization is entirely puppets!
2. The land worked should always be a "gold focus" (though sometimes it seems to be "default focus"... not sure if that's a glitch or deliberate). Theoretically, the AI may want a different focus for it, and, not being a cheater, needs to annex to do that.
3. So it appears to the player that the AI is going through the same tough decision-making as the player is.
 
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