Two years ago, California water regulators were stunned to learn that a major river in the San Joaquin Valley had stopped flowing. The waterway ran dry for 5 miles, leaving young fish stranded in muddy pools, birds fleeing to new homes, and paddlers, waterfront property owners and farmers gripped with frustration. In a state partly defined by its thirst for water, the emptying of the Merced River for four months in 2022 remained something of a mystery. Fed by the snowy peaks of the Sierra, the Merced has long been heavily pumped for agriculture, and its levels often dip considerably during droughts. Yet California generally restricts water draws to keep at least some flow moving downstream. An investigation that state water regulators are just finishing into why the river dried up offers some insight: While water users clearly drew out more water than was healthy for the Merced, the California State Water Resources Control Board found that the users were largely within their legal rights to do so, highlighting a fundamental problem with the state’s regulatory system.