Whenever someone mentions that the world will run out of oil and natural gas someday, I enjoy pointing out that there's no point in worrying about it. We'll run out of potable water before that can happen.
Regarding the geographic shifts in the American population (favoring the Sun Belt) over the past thirty years I say the same: Don't worry, they'll be back when they finally kill the Colorado River. And their groundwater. And their reservoirs. I mean, at the rate that Desert Metropolises like Phoenix, Vegas, and Los Angeles are pissing through the available resources, the Great Lakes region will start looking very good in the next decade or three. Not that Texas won't be a joy when the water's mostly gone and our summers have heated up even more.
Any discussion of depleting a natural resource sounds, by definition, at least a little alarmist. We have so little direct experience with and social context for running out of anything here in the land of eternal plenty that it makes sense for most people to be unable to wrap their minds around it. Logically, though, it would make less sense to believe that things that cannot be man-made (or can be only at great cost) won't be exhausted someday. I mean, compare oil depletion scenarios to the belief that the Earth makes oil in its crust and tell me which one is nuts.
The unprecedented drought in California is drawing more attention to the issue, with reliable estimates that the supply of stored water is down to about one year. This does not imply, as some news outlets concluded, that California will be "out of water" in a year. At some point it'll rain and alleviate the immediate crisis. It does indicate that a potential disaster is never more than a few years off under the present circumstances, though.
The US and other developed countries are positively drowning in water compared to the rest of the world though. Changing consumption patterns, population growth, and changing climate add up to demand for water outpacing supply by nearly half in 2030, according to the UN. If the world thinks it has seen wars over resources, wait until it sees two massively populated but impoverished countries fighting over the last of the available water. I kind of picture it like the Battle of Helms Deep, but more dehydrated.
People tend to have an unshakable faith in technology to solve these problems for us. It's not in fact the worst argument in the world. History has given us a number of examples of how we've been able as a species to overcome some of our limitations with science. I would believe, for example, that by the time the oil runs out a synthetic substitute or alternative might be available. There's not many candidates for "water substitute," though.
Places like Southern California, the UAE, and Western Australia are relying at present on desalination as their savior. But desalination is a remarkably expensive and energy-intensive process. In most uses it also does little more than supplement cheaper and more accessible sources of water to meet the needs of large populations. The number and scale of desalination plants that would be necessary to support California's 40,000,000 people (not to mention Phoenix and Vegas, who will probably need pipelines) is impractical veering toward impossible, even if we disregard the ecological impact of large scale desalination.
I don't think it's going to be tomorrow or even a decade from now, but at some point in my lifetime I expect to live in a world in which deserts once again resemble deserts and the illogic of having a sprawling metropolis in the middle of one cannot be ignored. The Southwest will resemble (as it once did) the Australian Outback when the capacity to support four or five million people in a place like Phoenix disappears for good. In places less wealthy than the US, it's neither bold nor prescient to predict that the situation is likely to get much uglier.
Don't worry though: the good news is that an ever-increasing share of the global potable water supply is being handed over to private corporations. That should help.