Boil or steam cubed potatoes in a large pot of water until tender, but not too soft (overcooking will cause the potatoes to turn to mush when all the ingredients are stirred together). Transfer to a large serving bowl.

While the potatoes cook, place bacon pieces in a large, deep frying pan. Cook over medium heat until evenly brown. Drain and set aside, reserving drippings.

Add onions to bacon drippings and saute until golden and tender.

In a small bowl, mix together the flour, sugar, salt, dry mustard, garlic powder, and pepper. Slowly add flour mixture to the sauteed onions. Cook and stir until mixtures thickens, then remove from heat. Carefully stir in water and vinegar (be careful because sometimes it bubbles and pops), then return to the stove. Bring to a boil and stir constantly for 1-2 minutes. Carefully pour vinegar over warm sliced potatoes. Add bacon and gently stir until potatoes are coated and heated through.

Sprinkle top with parsley and serve warm.