Secretary of State George P. Shultz yesterday called Nicaragua's Sandinista leaders "a bad-news government" and said the United States has "a moral duty" to help that country's "contra" rebels in their fight to prevent a Soviet-dominated government from gaining a permanent hold in Central America.

"I see no reason why we should slam the door on people just because they have been taken behind the Iron Curtain," Shultz told the House Foreign Affairs Committee in testimony that signaled the administration's determination to seek congressional approval of $14 million in aid to the contras.

"While we are promoting democratic reform throughout Central America, the Soviet Union and Cuba are abetting the establishment of a communist dictatorship in Nicaragua," he said during an exchange in which Rep. Gerry E. Studds (D-Mass.) described the contras as "a mixed group of mercenaries and thugs and democrats."

"I think we have a moral duty to help people trying to bring about the freedom of their country," Shultz replied. "There is a kind of stark choice of what you say to a person who is ready to fight within his own country, whether it is in Cambodia or Afghanistan or Nicaragua or whatever. I hope we can say to them that we're on their side. I certainly am."

Shultz's comments followed an emotional appeal by President Reagan, who in his weekly radio speech last Saturday called the contras "our brothers." After Reagan's speech, a senior administration official told reporters that the president had decided to wage an "educational campaign" to bring public pressure on Congress to lift the ban it imposed last October on giving the contras $14 million in aid this fiscal year.

Shultz appeared before the committee yesterday to present the administration's foreign aid requests for fiscal 1986. Studds, a persistent critic of administration policy in Central America, referred to Reagan's radio address and said, "I thought for a moment that Lewis Carroll author of Alice in Wonderland had been brought back to life and hired as a speech writer at the White House . . . . Can't we do better than this?"

Rep. Michael D. Barnes (D-Md.), chairman of the Western Hemisphere subcommittee, warned Shultz that a request to renew aid to the contras would "provoke a very divisive debate for this country." Barnes urged the administration to look at alternatives, such as asking the Organization of American States to examine U.S. charges that Nicaragua is attempting to spread subversion in Central America.

"We not only look at alternatives but we work at them," Shultz replied. He cited his visit to Nicaragua last year, support for the so-called Contadora effort to find a comprehensive peace plan for Central America and U.S. attempts to halt the flow of arms from Nicaragua to El Salvador and to induce Nicaragua to stop its military buildup.

"What we have in Nicaragua is a government that's a bad-news government," Shultz concluded. "Now how can that get changed? We'd like to see them change. But they don't seem inclined to do so. So we have followed these alternatives, and we will continue to follow these alternatives."

The only committee member to publicly support aid for the contras was Rep. Henry J. Hyde (R-Ill.) who said: "Sometimes when you have a leg that is suffering from gangrene, you just can't talk it away . . . . All the descriptions of the people who must do the dirty job as thugs doesn't obscure the fact that there is a dirty job to be done and the ultimate beneficiary is freedom."

In other testimony, Shultz resisted efforts by the committee chairman, Rep. Dante B. Fascell (D-Fla.), to get him to say when the administration will submit its fiscal 1986 economic aid request for Israel.

Israel is expected eventually to get economic aid at least equal to the $1.2 billion it will receive this year, but Shultz said the administration won't commit itself to a figure until Israel makes more progress on a comprehensive program to deal with its soaring inflation rate and other economic problems.