By Suadad al-Salhy and Kareem Raheem
BAGHDAD (Reuters) - The red flag of revenge flies over a house in Baghdad's Shi'ite stronghold of Sadr City, where residents are mourning the victims of a triple bombing that killed 85 people at a funeral in the same place at the weekend.
Young men with pistols tucked into their belts or rifles slung over their shoulders patrol the streets of the sprawling, impoverished swathe of the Iraqi capital, no longer trusting official security forces to keep Sadr City's three million people safe.
No group has claimed responsibility for Saturday's attacks, but many suspect the Sunni militants of al Qaeda, who have been this year and mounting attacks that have reversed a declining trend in sectarian violence that reached a climax in 2006-07.
The deterioration of security is undermining Shi'ite Prime Minister Nuri al-Maliki, who is also commander-in-chief of the armed forces, and who won the last election by presenting himself as the man who restored a measure of stability to Iraq.
"Logic dictates that the more attacks by al Qaeda, the less credibility will be left for Maliki," said former general Shakir Salman, a military analyst who advises Iraq's defense ministry.
"It's just like a boxing match, whoever punches more scores higher points."
Trained and equipped by Washington at a cost of nearly $25 billion and more than a million strong, Iraq's security forces have yet to master foes who fought the U.S. military in the years after the invasion that toppled Saddam Hussein in 2003.
More than 5,500 people have been killed in violence this year, prompting concerns of a return to sectarian bloodletting.
So far, the killing has been largely one-sided. Shi'ite militias, most of which disarmed, joined the reconstituted army and police or entered the political process in recent years, have refrained from retaliating for attacks by Sunni insurgents.
But in Sadr City, where the Shi'ite Mehdi Army militia still has a strong presence, people are losing patience.
"I swear to God, if I caught anyone who was involved in that explosion, I would hang him from an electricity pole and burn him one million times," said Ahmed, a young man from Sadr City who lost a relative in Saturday's bombings.
"Just as he burned the innocent people, I will do the same. This is God's law: an eye for an eye and a tooth for a tooth."
Rivals of Maliki, both Sunni and Shi'ite, are likely to seize upon the worsening security outlook to thwart any ambition he may have of seeking a third term in next year's elections.
"The failure in the management of the security file won't affect his chances for the next election: it already has deeply affected him," said Hakim al-Zamili, a senior lawmaker who sits on parliament's security and defense committee.
In response, the government is looking at plans to create a state-backed Shi'ite militia to combat al Qaeda and prevent local groups taking matters into their own hands, officials say.
The idea is to combine elements from the Asaib al-Haq and Kata'ib Hezbollah militias, which ceased fighting in Iraq after 2011, as well as members of the former Mehdi army, which Maliki defeated in a U.S.-backed offensive in 2008.
Mehdi Army leader Muqtada al-Sadr has since become a potent force in mainstream politics. Sadr City, once known as Saddam City, was re-named in honor of Muqtada's father, a Shi'ite spiritual leader who was assassinated during Saddam's rule.
In a speech on Saturday, hours before the bomb blasts in his bastion, Sadr urged his many followers to show restraint.
"Everyone must know that I strictly prohibit targeting Iraqi Sunnis and Shi'ites or anyone else, or targeting their mosques or places of worship for any reason," he said. "Targeting Sunnis or the opposite could lead Iraq into an abyss with no way out."
Following the funeral bombings, tribal leaders from the area decided to send a delegation to Sadr next week and petition him to remobilize the Mehdi Army to protect Iraq's Shi'ite areas.
For now, neighborhood watch committees are springing up in Sadr City to help security forces patrol the streets.
Ali Hussein, who may lose a leg after being wounded in Saturday's attack, in which seven of his cousins were killed, said there was no choice but to act.
"Apparently the government can't do anything about security, so the young men, or the Mehdi Army, or whoever must do something... we say the Mehdi Army should be reactivated to save at least our homes."
"We don't want anything from the government... but allow to us to come back (as Mehdi Army fighters) and we will take care of the rest."
(Additional reporting by Ahmed Rasheed; Writing by Isabel Coles; Editing by Alistair Lyon)
(This story was refiled to remove extraneous word in the fourth paragraph)