Well, according to the chat faq:
If you make a mistake when entering a message, press the ↑ up arrow to
edit your last message … or press esc to cancel editing. You have 120
seconds to edit your messages. All edited messages have a small edit
Same holds for delete, and some interesting explanation is given in this other post.
Regarding "why it is not possible for life time", balpha who is the developer writing the code behind the chat, said in this answer:
We're talking about chat here. Conversation. Talking. You can't go
back to last weeks party, choose the things you never should have
said, and un-say them. In particular, that could quite well remove any
sense from the rest of the conversation that was not deleted.
And I tend to agree.