BAGHDAD - Seven years after the U.S.-led invasion ushered in democracy, Iraqis making do with a few hours of power a day and living amid mounds of rubbish and pools of sewage wonder if they should vote in a March election.

We don't trust the election or the candidates, Samir Salahuddin, a mechanic in the northern city of Kirkuk, said.

I am now searching for kerosene to warm my family during the night, yet we live in a country rich with oil.

Election campaigning started on Friday with party workers putting up election advertisements across Baghdad. As in last year's provincial election, fierce competition is likely to turn cities into forests of banners and posters.

But Baghdad's Sadr City slum, perched atop an oilfield and ravaged by years of bombings and militia battles, is a symbol for many of political incompetence and corruption which have sapped voter enthusiasm and led to mismanagement of Iraq's vast oil wealth.

I hear people say that Sadr City is rich, but I do not see the wealth, Raziqa Fokus, a widow and mother of five, said.

Why do my children not look rich? Why do the streets look like this?

I will not take part in the election because I did not see anything tangible from the government, she added, while heading out to throw a sack of garbage into the street. Another resident complained that rubbish usually remains uncollected for months.

Iraqi and U.S. officials hope the March 7 parliamentary election will solidify the country's young democracy and draw former insurgents and militias into the political process -- just as U.S. troops prepare to withdraw.

Sectarian warfare unleashed by the 2003 U.S. invasion has faded, but tensions between once-dominant Sunnis and majority Shi'ites are high.

This has been stoked by the Shi'ite-led government's rhetoric against Sunni dictator Saddam Hussein's outlawed Baath party and moves to ban candidates accused of Baathist ties.

In Sadr City, one of several Iraqi slums full of unemployed young men ripe for recruitment by insurgent, militia or criminal groups, ragged boys play in stagnant pools of water and the smell of raw sewage and garbage wafts through the air.

An ugly web of crisscrossing wires forms part of an informal electricity grid hooked up to diesel generators to compensate for Iraq's patchy national network that still provides far less than 24 hours of power per day.

I'm just an employee. Corruption, a lack of coordination and haphazard decisions at the electricity ministry are to blame, said an electrical engineer who declined to be named.

GOVERNMENT SAYS MUCH ACHIEVED

Jinan Abdul-Jabbar, a lawmaker and member of Prime Minister Nuri al-Maliki's State of Law coalition, disputed accusations of poor government performance. Security, on which Maliki is expected to base his campaign, has improved dramatically.

There were priorities and people understand that -- security first then the services, she said. I believe that despite the challenges that faced the government, it managed to achieve a lot.

Rebuilding is a tall order after decades of war and sanctions. But the world's 11th largest oil producer is trying to revamp its crude oil sector with a series of deals set to vault it into the top three.

Iraq hopes an increase in production capacity to 12 million barrels per day (bpd) from 2.5 million bpd within six or seven years will bring the cash needed for development.

And many may vote along religious, political and tribal lines, and not on the perceived competence of candidates, Baghdad University analyst Saad al-Hadithi said.

In the 2005 elections, religious leaders urged Shi'ites to vote for Shi'ite Islamist parties while Sunnis largely boycotted the polls, helping to fuel the insurgency.

I believe a lack of services has no big effect in Iraq ... It's affiliations to this or that side. There are political pressures that control the Iraqi voter, Hadithi said.

(Additional reporting by Mustafa Mahmoud; Editing by Mohammed Abbas and Michael Roddy)

Iraq