The reservoir math
Seven states divided the Colorado River in 1922. The negotiators used the flow records they had, which came from a stretch of years that turned out to be among the wettest in several centuries, and they wrote allocations totaling more water than the river has reliably carried since. Everything downstream of that decision, including a century of litigation and the negotiations running today, is an argument about an arithmetic error made in good faith with the best data available at the time.
Warming has made the gap wider. Higher temperatures pull more water out of soil and snow before it reaches a channel, so a normal snowpack now yields less runoff than the same snowpack did in 1980. Lake Mead and Lake Powell dropped far enough by 2021 that the federal government declared the first shortage in the system's history, which triggered mandatory cuts to Arizona and Nevada. The reservoirs recovered some in the wet years that followed, which bought time and took the urgency out of the room.
Where the water actually goes
Public conversation about water runs heavily toward lawns and showers, and residential use is a small share of the total. Agriculture takes roughly three quarters of Colorado River water, and a large fraction of that grows alfalfa and other forage for cattle. The leverage therefore sits in irrigation. A ten percent reduction in agricultural demand frees more water than eliminating every municipal use in several cities combined, which is why the serious proposals all involve paying farms to fallow ground or to switch crops.
Groundwater is the part with no meter on it. When surface supply falls short, farms and towns pump, and in much of the country nobody is counting. The Ogallala aquifer under the High Plains has dropped more than a hundred feet in places and is not being recharged at anything like the rate it is being drawn. Parts of California's San Joaquin Valley have sunk several feet as the aquifer beneath them compacted, which permanently destroys the storage capacity and buckles the canals that deliver surface water. Land that subsides does not come back when the rain returns.
Cities have gotten better at this than the headlines suggest. Las Vegas recycles nearly all of its indoor water and has been paying homeowners to remove turf for two decades. Phoenix, Tucson and Los Angeles all use less water in total today than they did with far smaller populations. Efficiency has bought real time.
It also removes the easy cuts. A system that has already fixed its leaks and replaced its lawns has no surge capacity left for the next dry decade, which puts the remaining decisions on farms and on growth, and those get settled in court and in legislatures rather than in a utility's operating plan.