In my opinion basic type inference, name parameters, better support for immutability* and multiline strings represent the majority of the deficit in terms of making java more expressive and convenient. Other things such as higher order functions (would require an extension of the type system) raise issues that make the benefits less clear cut.
* my view on immutability is that it should be possible to 'bake' a class or an interface. So it can be manipulated before being made immutable.
(Apparently something like this is possible in Java 6 using annotations and compiler plugin extensions, but apparently it is not straight forwards to get working with IDEs (and as such, given the importance of IDEs one may as well change language).
Strong-typed alternatives to Java have existed for ages, such as Nice, KSL, and Scala, so if you want you can take your pick in mix it in with Java code right now.
As far as I understand it Sun just didn't want to fork the Java language.