Install rubygems error

I made the mistake of trying to upgrade to 1.8.4 from 1.8.2 and had intended to upgrade to rails 1.1. I have now completely borked my ruby gems installation. After installing ruby I get the following error when trying to execute gem:
/usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require__': no such file to load -- zlib (LoadError)
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require'
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/package.rb:9
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require'
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/builder.rb:1
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require'
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems.rb:61:in `manage_gems'
        from /usr/local/bin/gem:4
So I decided to re-install rubygems. When trying to run setup.rb I get:
/usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require__': no such file to load -- zlib (LoadError)
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require'
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/package.rb:9
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require'
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/builder.rb:1
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require'
        from /usr/local/lib/ruby/site_ruby/1.8/rubygems.rb:61:in `manage_gems'
        from /home/stuart/rubygems-0.8.11/./post-install.rb:64:in `install_sources'
        from /home/stuart/rubygems-0.8.11/./post-install.rb:75:in `try_run_hook'        from setup.rb:577:in `run_hook'
        from setup.rb:1315:in `exec_task_traverse'
        from setup.rb:1168:in `exec_install'
        from setup.rb:887:in `exec_install'
        from setup.rb:705:in `invoke'
        from setup.rb:674:in `invoke'
        from setup.rb:1352
The "/usr/local/lib/ruby/site_ruby/1.8/rubygems/custom_require.rb:21:in `require__': no such file to load -- zlib (LoadError)" entry seems to be trying to "require__ path" at line 21 of custom_require.rb line 21.

Can anyone help me get my rails back? I swear I'll never try to upgrade again..:-)