Nanci

I think it's about a breakup. The two people are dividing their CD collection as they go their separate ways. As a previous poster said, Nanci refers to Nanci Griffiths and the Loretta in this song refers to Loretta Lynn.

Is it possible that the lyrics themselves are a conversation?
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"I can't believe you, you bend your words like Uri Geller's spoons" - 1st person, and a derogatory comment at that since Uri Geller, although entertaining was lost from collective popular conscienous after being 'disproven' by various skeptics

"(It's) Not quite safe here, (and) every judgment seems to smack of doom" - 2nd person - the reference to Geller being a severe judgment and dooming to whatever matter is presented between the two characters

"Are you ok?" - 1st person - asked after judgment passed, we've all felt that, the 'trying to go back and correct my mistake by being nice way of talking to your loved one' feeling...

"I'm just fine" -2nd person - curtly and deservedly.

"You take Nanci, for me Loretta is fine" (referring to Nanci Griffith's songs of despair and longing, and Loretta Lynn's struggle but sunshine songs, and between these two characters, 1st person is saying you take the long road pal to the 2nd person. be as sad as you want to) - 1st person,

but at the end of the song, the context switches so that the 1st person feeling guilty chooses to let the 2nd person being wronged, in more than one ways now, choose the lighter path of Loretta Lynn rather than the darker Nanci Griffiths to wright the wrongs as the 1st person, the author, is comforted in the self-inflicted punishment that most humans can relate to.

It's about two people (close friends?) who have some ongoing argument or disagreement, but instead of addressing the real, serious issue, they work out their tension by bickering over which country music singer they prefer (Loretta Lynn or Nanci Griffiths). And all the while they have an unspoken agreement that the real issue will remain unmentioned.

I always thought this song was about a double date with one guy serving as the wingman who got doubled up with the outspoken one who wants to talk politics, death, and taxes.

Quonset - I like your post. Song seems a little different to me now. Still a great song by a great band who I got to see live in Boston back in like '98 or something. Great show.

I thought it was about two parents arguing about their divorce and which child stays with whom. Then when everything is settled they change their mind again.

in live recordings there is a code with "Allison's better/Emmylou's almost perfect" - until I heard that it hadn't occurred to me that the song is anything other than two wingmen discussing girls.

I thought this song was about a game of bridge. They are deciding on partners (Nanci or Loretta). The singer is trying to parse out what the other players are saying to determine how to bid. Twice he sings "no one's brought up suit", as in which suit of cards to bid with.