The ground can hold quite a bit of water, and of course lakes, rivers, and ponds store water. One of TVA's main objectives is to try to stabilize the water reserves for this entire part of the country. Their dam and reservoir system stores a vast amount of water. Without TVA, the current population in this part of the country would not be sustainable.

The flip side of the coin is that with droughts like we've had for the past few summers, some parts of TVA's capacity has been close to being tapped out. Also, just because we have water, doesn't mean we have it where we need it or that we can justify getting it where it needs to be. Atlanta just about ran out of water last year, and of course, it's not practical to water everything. Even one or two large trees can use up more water than most of us would be willing to supply if we had to pay for it (tap water or maybe even electrically-pumped well water).

Here is a link that might be useful: TVA.gov