It seems that the Ruby on Rails code can't see any of the ruby gems installed in my home ~/.gems directory. The code can see the gems fine if I run as a bash user (because the $PATH has ~/.gems in $GEM_HOME).
Is there any way to get rails to look in this directory when looking for gems? The wiki didn't have anything on this.
I found the solution to this one. basically, you have to list the full pathname of the personally installed ruby gem. So instead of:require 'active_merchant'