SecProbe.io

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Letterhead:
McAfee & Taft
A Professional Corporation

10th Floor - Two Leadership Square
211 North Robinson - Oklahoma City, OK 73102-7103
(405) 235-9621 - Fax (405) 235-0439
www.mcafeetaft.com

                                                           JERRY A. WARREN
                                                           ATTORNEY AT LAW

                                                             WRITER DIRECT
                                                            (405) 552-2224
                                                        FAX (405) 228-7424
                                               jerry.warren@mcafeetaft.com

October 18, 2005

VIA TELECOPY (202) 772-9210
---------------------------

Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C.  20549
Attn:  Adam Halper, Division of
         Corporation and Finance

                          Re:  The American Education Corporation
                               Schedule 13E-3
                               File No. 5-54041
                               Form 10-KSB for fiscal year ended 12/31/04
                               Form 10-QSB for quarter ended 3/31/05
                               File No. 0-10873

Ladies and Gentlemen:

          The following is responsive to your letter of comment dated July
27, 2005.  We are including herewith a revised copy of the Schedule 13E-3
and a disclosure document marked to indicate changes.  The following
responses are keyed to your comments in your letter dated July 27, 2005.

Schedule 13E-3
--------------

     1.  You have requested that the Company include the information required
by Items 3, 5, 6, 10 and 11 of Schedule 13E-3 with respect to each executive
officer and director of the Company.  The information required by Item 3
with respect to each officer and director is included in the Company's
Form 10-KSB/A and is incorporated by reference into Schedule 13E-3.  Items
5 and 6 have been revised as required.  Item 10 requires no disclosure
other than that already presented.  The information required by Item 11
has been updated and is included in the Company's 10-KSB/A which is
incorporated by reference to the Schedule 13E-3.

     2.  You have requested the Company's calculations as to how the
determination was made that approximately 6.5% (6.4% currently) of the
stockholders are expected to be cashed out.  Set forth below is the
information available to the Company for the purpose of such calculations
updated to September 30, 2005.  Where beneficial owners of shares held in
street name are not known, one half of the shares are presumed to be held
by owners with less than 2,000 shares.

Holders of Record:             # of Holders                  # of Shares
                               ------------                  -----------
Over 2000 shares                    107                       10,848,387
Under 2000 shares                 2,160                          401,467
     Subtotal                     2,267                       11,249,854

Street name (known) holders:
Named over 2000 shares              112                        1,978,131
Named under 2000 shares             277                          103,703
     Subtotal                       389                        2,081,834

Street name (unknown) holders
 (presumed to be over 2000
 shares)                            61                           400,887
Street name (unknown) holders
 (presumed to be under 2000
 shares)                           300                           400,886
     Subtotal (Street Name)        750                         2,883,607
Total all holders                3,017                        14,133,461
Cash out total shares:           2,737                           906,056

     Based upon those calculations, only 0.064 (6.4%) of the stock is
expected to be cashed out.  The only conditional events that can effect
the calculations above are changes in stockholders' holdings as a result
of purchases, sales, combinations of accounts or by beneficial
stockholders that held their shares in street name having their shares
transferred to them of record prior to Effective Date (defined below) of
the reverse split.  The calculations above have already assumed that 50%
of the shares of unknown beneficial stockholders whose stock is held in
street name own less than 2,000 shares, which represents 2.84% of the 6.4%
total that is expected to be cashed out.  Accordingly, there is a
substantial margin to allow for any contingencies that may occur.

     Additionally, since the Company announced its intentions to go private
on April 1, 2005, stockholders have had an opportunity to adjust their
holdings of the Company's common stock to either be cashed out in the
reverse split or to avoid cash out in the reverse split.  From April 1,
2005 through September 30, 2005, approximately 1,497,000 shares of the
Company's stock have traded at a weighted average price of $0.49 per share.
To the Company's knowledge, no insider/affiliate stockholder has been a
participant in such trading.

     Since the filing of the original Schedule 13E-3, the shares owned by
The objecting beneficial owners of the Company have increased from 432,462
shares to 801,773 shares.  The Company believes that this is primarily a
result of our current holders acquiring additional shares of the
Company's common stock in anticipation of the transaction.  During this
time period, the average weighted trading price of the Company's common
stock for the thirty days preceding the original filing of the Schedule
13E-3 and the filing of Amendment No. 1 to the Schedule 13E-3 were $0.46
per share and $0.59 per share respectively.  The Company believes that
the recent increase in its shares price is a result of these holdings
consolidations and not reflective of the true value of the Company's
shares.  The Company is, however, considering increasing the amount of
the cash out price offered to stockholders in the transaction.

     3.  As noted paragraph 2 above, it is highly unlikely that more than
10% of the outstanding shares will be converted into cash as a result of
the transaction.  The Company will attempt to determine the number of
shares that would be cashed out immediately prior to filing the
Certificate of Change amending the Company's Articles of Incorporation to
effectuate the reverse split (the "Effective Date") by reviewing the
Company's stock records with its transfer agent.  In the unlikely event
that the pre-Effective Date calculation showed that the amendment to the
Articles of Incorporation would result in cashing out more than 10% of the
outstanding shares, the Company would simply not file the Certificate of
Change.  Additionally, the Schedule 13E-3 has been amended to provide that
the Certificate of Change filed by the Company will provide that the reverse
split and the forward split will be null and void if the reverse split and
the forward split, individually or collectively, result in more than 10%
of the outstanding shares of the Company being cashed out.  Finally,
disclosure was added to provide that, in the event that the Company files
the Certificate of Change and later determines that the reverse split and
the forward split will result in more than 10% of the outstanding shares
being cashed out, the Company will immediately amend the Certificate of
Change to reverse the effect of the reverse split and the forward split.

     4.  The transaction amount was changed to $457,500 immediately prior
to filing and the amount was changed elsewhere in the documents, except
for the "Source and Use of Funds Section."  We have updated the
information through September 30, 2005 and the amount throughout the
document is now $453,500.

     5.  We will make certain that any information that is currently
included in the Schedule 13E-3 but not included in disclosure statement
will be included in the definitive disclosure statement.

Item 2.  Subject Company Information
------------------------------------

     6.  The Company's Amended Form 10-KSB for the fiscal year ended
December 31, 2004 (the "Form 10-KSB/A") has been updated to provide the
market prices through June 30, 2005.

     7.  Although the note representing the $300,000 loan to Mr. Butler
was not included in the Company's Form 10-KSB for the year ended December
2000 (the year in which the loan was made), the loan was disclosed under
Item 12, Certain Relationships and Related Transactions.  In the Company's
Form 10-KSB for the year ended December 31, 2003, Item 12 disclosed the
repayment of such note in exchange for 200,000 shares of the Company's
common stock owned by Mr. Butler.  The promissory note has been included
as an exhibit to the Company's Form 10-KSB/A.  A hard copy of the Note is
provided separately with this letter.

     Mr. Butler's wife filed for divorce in 1999, at which time, Mr.
Butler's primary liquid asset was his stock in the Company.  Mr. Butler's
personal net worth was at a level that required that he either make a
sizeable cash settlement or transfer half of his 1,046,575 shares of the
Company common stock.  Key principal stockholders and the Company's
directors suggested and approved the loan to Mr. Butler to avoid the
possibility of a large number of company shares passing to Mrs. Butler,
which, combined with the shares and options owned by his son (who was
previously an officer of the Company and began to liquidate his holdings
during this period), would adversely impact the market for the Company's
stock if sold.  Mr. Butler's son liquidated 207,430 shares in a seven-month
period following his termination of employment with the Company during
which time the market price of the Company's stock decreased from $1.78
to $0.88 per share.  The shares sold by Mr. Butler's son during this period
accounted for approximately 15% of the total shares traded during that period.

     As an OTCBB listed company there is low, sporadic demand for the
Company's shares, and, based on the factors listed above, the board of
directors believed that a loan strategy was in the best interest of all
stockholders.   In addition, the principal stockholders and the board were
very concerned by the possible disincentive to Mr. Butler with respect to
loss of his share ownership and its value as an incentive to manage the
business.  Accordingly, the Company made the loan to Mr. Butler on October 26,
2000, and Mrs. Butler received a lump sum cash and long-term cash settlement
and 75,000 shares of the Company's stock from Mr. Butler's personal holdings.
At the time the loan was made, the board of directors agreed that Mr. Butler
could repay the loan by surrendering shares of his Company stock, which would
be valued for loan repayment purposes at the higher of market value when the
initial loan commitment was made or an amount established by a subsequent
valuation.  The note signed by Mr. Butler was very informal and did not
contain these provisions for repayment by stock surrender.

     In October of 2003, in order to comply with the Sarbanes-Oxley Act of
2002 requirements with respect to loans to officers, Mr. Butler repaid the
$300,000 loan by surrendering 200,000 shares of Company common stock.  The
market value of the stock at the time of the initial loan commitment was
$1.50 per share and an average of closing prices in the time period in
which the transaction was initiated was somewhat higher.  Board minutes
for January 31, 2004 noted that Mr. Butler had the option to repay the
loan using Company stock at the higher of market at the time of the
initial loan commitment or at an amount established by an independent
valuation.  Such a valuation was made in early 2003 and the value at that
time was approximately $0.81 per share.  As a result, Mr. Butler's shares
were valued at their market value at the time of the initial loan
commitment and Mr. Butler recognized no ordinary compensation expense.

     Mr. Butler agreed to deliver his endorsed certificate to the Company
upon agreement by all the parties to the repayment terms.  The market
value on that date, October 26, 2003, was $0.60.  The characterization of
the transaction as a repurchase of common stock was discussed by the
Company's chief accounting officer and its auditors and was determined to
be an appropriate classification.

Item 5.  Past Contacts, Transactions
------------------------------------

     8.  Janice Butler is the wife of Jeffrey Butler, the Chief Executive
Office of the Company.  This relationship has been added to the disclosure
under Item 5.

Item 6.  Purpose of the Transaction
-----------------------------------

     9.  We have revised the Disclosure Statement under "Special Factors -
Purpose of the Transaction" to disclose that the Company has no plans or
negotiations that would result in the actions set forth in Items
1006(c)(1)-(8) of Regulation M-A other than as described in response to
this item.

Item 11.  Interest in Securities of the Subject Company
-------------------------------------------------------

     10.  The security ownership has been updated in the Form 10-KSB/A to
the most recent date practicable on the date the Form 10-KSB/A was filed
with the SEC.

Item 13.  Financial Statements, etc.
------------------------------------

     11.  The Company's Form 10-KSB/A shows Learning Pathways, Ltd. as a
discontinued operation for the years ended December 31, 2004 and 2003.

     12.  Item 1010(a)(3) of Regulation M-A requires that the Company
furnish the ratio of fixed charges computed in a manner consistent with
Item 503(d) of Regulation S-K.  Item 503(d) of Regulation S-K requires
that a ratio of earning to fixed charges be shown if "you register debt
securities."  Nevertheless, we have included this ratio in the disclosure
statement under "Financial and Other Information."  Item 1010(b) of
Regulation M-A requires proforma financial statements "if material."  The
transaction will have the effect of reducing cash by $453,500 and
decreasing common stock and paid in capital by the same amount.  The
Company does not believe that this is material.

Item 14.  Persons/Assets, Retained
----------------------------------

     13.  You have requested that the Company provide the disclosure
required by Item 1009(b) of Regulation M-A with respect to employees used
by the board of directors in connection with the transaction.  The
Disclosure Document has been revised to indicate that the Company's Chief
Executive Officer, Jeffrey Butler and its Chief Financial Officer, Neil
Johnson have performed management services to the Company in connection
with the transaction.  Other than as disclosed, no employees are being
used by the board of directors in connection with the transaction other
than in routine support matters.

Item 16.  Exhibits
------------------

     14.  Loan documents were filed as exhibits to the Company's Form
10-QSB for the quarter ended June 30, 2005, filed with the SEC August 15,
2005.

Exhibit A.  Disclosure Statement Outside Cover Page
---------------------------------------------------

     15.  The legend required by Rule 13e-3(e)(1)(iii) is included on the
cover page, in bold type, of the disclosure document.  This will be on the
front page of the documents mailed to stockholders.

     16.  The second sentence of the second paragraph of the disclosure
statement states that the directors concluded that the transaction is fair
to all stockholders, which would include the unaffiliated stockholders.
We revised the sentence to make it clear that the board determined that
the transaction was fair to the unaffiliated stockholders.  There are no
other affiliates engaging in the transaction.

     17.  We have eliminated the referenced sentence concerning
"extensive" analysis from the second paragraph of the disclosure
statement.

Summary Term Sheet
------------------

     18.  We have add