gpg - cannot create key

I am trying to use gpg on RedHat 6.3, in order to encrypt / decrypt a file on the command line (ssh'ed into server).

I run the "gpg --gen-key" and I step through the menus taking the defaults. It then gets to a point where it says "We need to generate a lot of random bytes. It is a good idea to perform some other action (type on the keyboard, move the mouse, utilize the disks) during the prime generation; this gives the random number generator a better chance to gain enough entropy." it also briefly flashes a message that it can't connect to the agent. At this point the program hangs no matter what I do, and does not generate a key.

The same commands work well under RedHat 5.x (which is GNUpg 1.x, I believe).

gpg seems completely broken in RedHat 6.x..?

Any help would be greatly appreciated.