2 med. potatoes, pared and cubed
1/2 c. boiling water
1 c. chopped onion
3 tbsp. butter
3 tbsp. flour
Dash pepper
3 c. milk
1 1/2 c. (6 oz.) shredded Velveeta cheese
1 1/2 c. cubed ham (1 1/2 lbs.)

Cook potatoes in boiling water until tender (about 10 minutes). Drain reserve liquid. Add enough water to reserve liquid to make one cup. In pan saute onion in butter until tender, not brown. Blend in flour and pepper. Add milk and potato water all at once. Cook until mixture just bubbles. Add cheese, and stir to melt. Add ham and potatoes. Stir to heated through.