I always thought this song was about a pair of young lovers who had to split up due to certain circumstances (Like moving far away for university). She loves him, but for some reason beyond their control it's not going to work out and she accepts this. "Everything could be everything, if only we were older" means that things couldv'e possibly been different if they were both older and had more freedom to do whatever is in their own interest.
I always thought this song was about a pair of young lovers who had to split up due to certain circumstances (Like moving far away for university). She loves him, but for some reason beyond their control it's not going to work out and she accepts this. "Everything could be everything, if only we were older" means that things couldv'e possibly been different if they were both older and had more freedom to do whatever is in their own interest.