Sounds like your IT guy needs to have his walking papers signed by HR.
Make a business case and document and report it. I am sure the beancounters will shit their pants when they see you wasted $30,000 in lost salary to save $3,000 on a workstation. My above example is for office users with 4,000+ computers where it is simply not possible to upgrade. Only a major refresh signed by the CIO all at once will get the dinosaurs out. IN that scenario 512 megs of ram is very slow but can work for light office work fine if you stick with Office 2k3, adobe 8, and IE 6.
Many of these systems are common for home users too. In this economy $11/hr is the new norm for college students. Simply pitching a perfectly working computer does not make economic sense more than replacing a video card if you saved money for awhile to do so if you are a gamer making that wage.
But you are more valuable than working off the click demonstrate it to your bosses boss with your boss around and casually mention how you can do half your days job in 15 minutes on a modern computer and see what he says?
Such backward thinking IT people who do not want to do their job are incomptentent and need to go.