Lyric discussion by drdoe 

Cover art for Higher Than the Stars lyrics by Pains of Being Pure at Heart, The

I think the lyric "because you're not straight" is referring to his state of mind (or sobriety) rather than his sexual orientation. I think this song is about a kid who's been best friends with a girl since a very young age, and then experiences puberty ("'til you dropped another"), leaving him with feelings for her. He then suppresses these feelings ("so sure, you kept it under covers"), until one drunken night (in the back of her mother's car).

As for more annotation, I believe the lyric "drinking in the last days" is referring to the final year of high school or something similar. "The outcome, the only friend you ever had is setting off with a rich son" is most likely referring to a boyfriend of hers, possibly attending college with ("setting off"), tying into the first part.