Laggy performance

I'm on a 1.33 G4 Powerbook... 1 GB ram...

Looking at activity monitor, stats are as follows (rounded):
Wired: 94 MB
Active: 463 MB
Inactive: 451 MB
Free: 12 MB

The computer is kinda laggy, and the mouse cursor hops some. If I have 451 MB of inactive RAM, how come there isn't more FREE ram so that the computer isn't chugging as much?
Is there something I can do to free up more RAM, or is that just how the system budgets it?

Thanks,
-Kev

Hmm, the RAM is fine, that's just how OS X does it—inactive and free are the ones that are "free", or rather the ones that will be allocated to new programs etc. There's no problem with that, you're doing fine in terms of RAM.

Now, what about processor usage? Is there maybe a program that is constantly wasting your CPU?