Nobody seems to notice that this song is in 2 parts. The second part (the actual story of Pancho and Lefty) is the DREAM the person in the first part of the song sinks into. The P&L story is obvious: P&L are friends (more than friends, some say), L turns P in to the Mexican Army, collects his money and returns East. Obviously L is the rat, and P is the good guy. What is not clear is what the relationship is between the P&L story to the first part (which ends with "sank into a dream." That is what we can speculate on.
Nobody seems to notice that this song is in 2 parts. The second part (the actual story of Pancho and Lefty) is the DREAM the person in the first part of the song sinks into. The P&L story is obvious: P&L are friends (more than friends, some say), L turns P in to the Mexican Army, collects his money and returns East. Obviously L is the rat, and P is the good guy. What is not clear is what the relationship is between the P&L story to the first part (which ends with "sank into a dream." That is what we can speculate on.