Here's a quick tip for speeding up your Apache/Passenger powered Rails app. It'll take you about 2 minutes, and I guarantee you'll notice the speed-up.
- SSH onto your VPS
- Run the following commands: "a2enmod expires" and "a2enmod deflate"
Now, open up your Apache vhost config for your Rails app. Add the following:
Then, restart Apache by running: "/etc/init.d/apache2 restart"
This will gzip your html, css, and javascript. It'll also add far future expires headers for the appropriate cacheable filetypes. There's no downside, and it only takes a second. Bang for buck.
Edit: Check the comments for some possible downsides... ;)

That’ll keep your assets cached forever in browsers and caches. New versions of those files will never be retrieved by clients unless they hard refresh or clear their cache. I’d suggest using Rails-style asset timestamps (“/foo.png?82349824984″) and only set the expires/max-age headers if an asset timestamp is present. Great tip, though. Most sites will see a huge improvement.