Won't start a big argument, but replacing kanji with hiragana would make the language a vaguely-worded nightmare. Massive number of homonyms; huge number of verbs with slightly different nuance achieved through a different choice of kanji.
The language IS evolving toward hiragana for simple, everyday words, but ask any adult who has to read children's books (all in hiragana) how painful it is to group the words correctly and you'll agree a bigger change won't come soon.
If there are many homonyms that could be mistaken despite context, how do people understand the spoken language? Are verbal inflections incompletely represented in hiragana versus kanji?
As for grouping into words, other languages have found spaces useful. ; )
There's a tonal accent, which is not conveyed in writing. I believe there are some regional variations of it, too.
In Japanese, it's related to something called the "accent nucleus." Googling that will give you a lot of random scholarly articles. Oddly enough the best simple explanation I could find was this:
"Katakana are not used only for foreign words. Katakana are also used with onomatopoeia, newly coined words, names when you don't know the kanji, and more.
Furthermore, katakana can be used to vary the style in writing. It is not uncommon to see an entire sentence in nothing but katakana, often to express a certain emotion (even when it lacks foreign words altogether). In other words, ヲ is actually used once in a while.
In addition, in ancient times, katakana were considered the proper way to write the language, while hiragana were considered sloppy and vulgar. In this respect, katakana can be used to evoke an archaic style. "
Not to dispute your (very credible) assertion that it's more suitable for common use than hiragana, can katakana express more tonal subtlety than hiragana? Are there words for which it would be preferable to use hiragana for legibility reasons? Are both used together in compliment to express an even wider range of verbal tones?
The language IS evolving toward hiragana for simple, everyday words, but ask any adult who has to read children's books (all in hiragana) how painful it is to group the words correctly and you'll agree a bigger change won't come soon.