Why doesn't Java allow hiding static methods by instance methods?

I suspect it is to avoid confusion with dealing with the base class. In fact I imagine the designers didn't see an obvious way this should behave.

class Base {
    static void foo () {}
}

class Derived extends Base {
    void foo () {} // say this compiled
}

Base b = new Derived()
b.foo(); // should the static or the virtual method be called?

Should b.foo() call Base.foo() or should it potentially call Derived.foo()?

Simple answer: that would be the mess.

Concrete answer: what to call in that case Derived.foo()? Base.foo() can't be called as it's hidden (as per you), Derived.foo() can't be called as it's not static.