There two flags each give a number in megabytes. You can increase them to use more memory. The mx is the total Java heap size, which can go up to about 1850MB on many platforms, while ms is the initial heap size. They can both be the same number or you can use a range as you are here.
You are complaining because the JVM isn't using enough memory? I think that's a first. Most people complain that it uses too much. The JVM is tuned to make the best use of the memory allocated and request more when necessary. You can crank up the values of -Xms and -Xmx, but if your application doesn't need that memory you are wasting valuable resources. Depending on your JVM version, you may be able to use a -server switch on the command line to tell it to tune for long-running server applications or use -client to tune for short-run GUI intensive programs. This selection is made automatically in JDK 1.5.