What is the song with a boy who has a cape as a kid and as he gets older he finds the cape and finds that happiness again?

The song you're thinking of is "The Cape" by Guy Clark. It tells the story of a boy who, as a child, wears a cape and imagines himself as a superhero. As he grows older, he discovers the cape again and reflects on the joy and freedom of his childhood, symbolizing a return to innocence and happiness. The song beautifully captures the theme of nostalgia and the importance of holding onto one's dreams.