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Fedora does not package the mysql2 gem, which is an essential component of Rails 3 installs. It should be packaged.
This bug appears to have been reported against 'rawhide' during the Fedora 19 development cycle. Changing version to '19'. (As we did not run this process for some time, it could affect also pre-Fedora 19 development cycle bugs. We are very sorry. It will help us with cleanup during Fedora 19 End Of Life. Thank you.) More information and reason for this action is here: https://fedoraproject.org/wiki/BugZappers/HouseKeeping/Fedora19
Hi Edward, mysql2 gem has been imported into Fedora and on Fedora 19+, you can now install it using "yum install rubygem-mysql2". Enjoy!