This is “Pancho and Lefty” by the incomparable Townes Van Zandt, here recorded by Willie Nelson and Merle Haggard. You can see Townes himself playing one of the federales in the video.
There’s a lot to say about this terrific song; I’d like to make some observations of things that make the song a great piece of writing, period, much less great songwriting.
First, the song is tremendously elliptical. Its whole plot is driven by a central event, which is never narrated.
Second, the song is deep in the heads of its characters, alternating POV in its verses like a novel switching between back and forth between chapters.
Third, its images are surprising and inventive. “Now you wear your skin like iron, and your breath’s as hard as kerosene”; “the dust that Pancho bit down south has ended up in Lefty’s mouth”.
Fourth, it uses understatement to great effect. The devastated Lefty “can’t sing the blues all night long like he used to.”
Fifth, like all great country music songs, it uses the particular to get to the universal. The specific details of Lefty’s story add up to something none of us has lived, but because it’s so specific and so detailed, we feel like we’ve all lived it, and Lefty becomes the everyman.