Contrary to your entirely reasonable assumptions, California is more conducive to farming than most places. There is little to no frost, a nearly yearlong growing season, and plenty of water thanks to the natural reservoir that is the Sierra snowpack. The catch is that California has always been prone to multiyear droughts; while this is the worst single season on record, the drought itself is not particularly notable -- the last similar drought was just 40 years ago.
So why do we clamp down on residential watering while allowing almonds to be grown? Simple: residential watering provides no economic purpose, and dead grass will grow back when the water comes back. Almonds provide an economic benefit and we usually have plenty of water for them. Diverting water from residences to almonds during a drought is simply the price of keeping that part of the economy alive.
> Simple: residential watering provides no economic purpose
You have an impoverished notion of economic purpose. Eating almonds make people happy, so almond growers grow almonds and sell them to people that want to them. Riding horses make people happy so alfalfa growers grow alfalfa to sell to people to feed to horses. So too, lawns make people happy so they spend a whole lot of money making sure they have neat, green lawns. That money gets translated into jobs and economic activity just like the money spent on buying almonds because they taste good.
There's no moral and immoral uses here, just satisfying preferences. The way to sort this out is through market mechanisms. It might be a different story if we were talking about pricing people out of drinking water, but that's not even close to what's going on here.
Almond growers better be paying a premium then in order to compensate the residents of the state who lost their water to them. If California is conducive to farming other than water then the high price in water should be fine.
I think it's a mistake to keep harping on Almonds. California produces so much of the world's supply that ceasing production here would be hugely disruptive. Beef and Dairy, on the other hand, are produced in areas with far more available water. California could stop producing livestock and the world (and the state) would, for the most part, shrug and go about their normal business.
Almonds get so much attention, but if you look at the amount of water necessary to produce almond milk vs the amount of water necessary to produce cow's milk, almonds start to look at lot more attractive.
> So why do we clamp down on residential watering while allowing almonds to be grown? Simple: residential watering provides no economic purpose
Residential watering of, e.g., vegetable gardens serves exactly the same economic purpose (food production) as agricultural watering does. The difference is in who benefits -- agribusiness vs. individual residents.
How do you figure residential watering provides no economic purpose? Every day, about 15% of the vehicles I pass on my commute are vehicles exclusively dedicated to the upkeep of lawns. These vehicles stand out, because they are usually laden with all kinds of various equipment and have 4 or even 5 guys in the cab of the truck. Would you tell all of these people that they have "no economic purpose"? What should they be doing instead?
So why do we clamp down on residential watering while allowing almonds to be grown? Simple: residential watering provides no economic purpose, and dead grass will grow back when the water comes back. Almonds provide an economic benefit and we usually have plenty of water for them. Diverting water from residences to almonds during a drought is simply the price of keeping that part of the economy alive.