see also http://nhw.pl/wp/2008/09/16/mysql-collate-setting-in-rails-application

mysql-collation-fix.rb

require File.expand_path(File.join(File.dirname(__FILE__), '..', 'config', 'environment'))

charset = ENV["CHARSET"] || "utf8"
collation = ENV["COLLATION"] || "ut8_unicode_ci"

puts "Starting... charset will be set to #{charset}, collation to #{collaction}"
database_platform = YAML.load_file(File.join("config/database.yml"))[Rails.env]
database_platform.delete("socket")
ActiveRecord::Base.establish_connection(database_platform)
ActiveRecord::Base.connection.execute("ALTER DATABASE `#{database_platform['database']}` DEFAULT CHARACTER SET #{charset} COLLATE #{collation}\;")
ActiveRecord::Base.connection.tables.each do |table|
  ActiveRecord::Base.connection.execute("ALTER TABLE `#{table}` CONVERT TO CHARACTER SET #{charset} COLLATE #{collation}\;")}
  print "*"
end
puts "Successfully converted database charset to #{charset} and collation to #{collation}"

run.sh

curl https://raw.github.com/gist/2236348/d3c799bb63a2b84d40004ae2bc0b36f640786dd4/mysql-collation-fix.rb | ruby

# or

https://raw.github.com/gist/2236348/d3c799bb63a2b84d40004ae2bc0b36f640786dd4/mysql-collation-fix.rb | RAILS_ENV=production ruby

# or

https://raw.github.com/gist/2236348/d3c799bb63a2b84d40004ae2bc0b36f640786dd4/mysql-collation-fix.rb | RAILS_ENV=production CHARSET=win1251 COLLATION=win1251_ci ruby