Rails 3.2.1
ruby 1.9.3p0 (2011-10-30) [x86_64-linux]
openssl-0.9.8e-20.el5 opens
This problem arises when you don't install openssl prior to installing ruby. There are two fixes:
(Suggested fix) Install openssl and then recompile your version of ruby. Assuming you are using rvm, you can solve this by doing: rvm pkg install openssl
then rvm remove 1.9.3
then rvm install 1.9.3 --with-openssl-dir=$HOME/.rvm/usr
which compiles ruby with openssl.
Modify your Gemfile to say source "http://rubygems.org"
instead of source "https://rubygems.org"
Option 2 is quicker and easier, but more likely to cause problems in the future.