The stage is set in the Senate Appropriations Committee for "the battle of the needy."

It pits lobbyists for AIDS patients and big cities hardest hit by the AIDS epidemic against advocates for other sick, poor and disadvantaged groups in a Dickensian scramble for scarce federal dollars.

Such clashes were avoidable when government was growing and room could always be found in appropriations bills for new programs. But in the leaner times of budget austerity that appear to lie ahead, the AIDS fight could well be a preview of the kind of bitter appropriations battles to come.

The controversy surrounds a $173 billion spending bill for labor, health and education that was drafted recently by an appropriations subcommittee chaired by Sen. Tom Harkin (D-Iowa). Caught in an unusually severe budget squeeze, Harkin's panel roughed out a bill that earmarks a record $2.17 billion for AIDS research in 1991 but contains no funding next year for the $875 million AIDS-care bill signed by President Bush in August.

To remedy that, Sens. Brock Adams (D-Wash.), Frank R. Lautenberg (D-N.J.) and Alfonse M. D'Amato (R-N.Y.) plan to amend the bill by adding $190 million for the much-heralded program when the measure goes to the Senate Appropriations Committee in the next few days.

Most of the money would go to 16 cities -- including the District of Columbia -- whose hospitals and services have been overwhelmed by AIDS patients.

But the plan has encountered a storm of protest from advocates of dozens of other federal education, research and health programs whose increases would be cut by nine-tenths of 1 percent to free money in the bill for the AIDS allocation.

Susan Frost, executive director of the Committee for Education Funding, estimated that even such a modest levy would strike 6,000 elementary school children from coverage by the main federal compensatory education program and could roll back from $2,400 to $2,300 the maximum federal Pell Grant for poor college students.

"We share the concern about everything getting all it needs," Frost said. "In the case of the AIDS-care bill, there is concern that they didn't get adequate funding. Our problem is that, if the offset to achieve that funding cuts education, we would oppose that."

Among other programs that apparently would be cut under the Adams amendment would be the Head Start preschool program and research sponsored by the National Institute on Aging on Alzheimer's disease and bone loss in elderly women. His amendment would cut only programs set to be increased by more than the inflation rate of 4 percent in the new spending measure.

All funding in question is contained in the 1991 labor, health and human services and education spending bill that parcels out most of the federal government's funds for research, education and social programs.

Each of the 13 annual appropriations bills must set priorities and choose between worthwhile claimants for federal funds. But the labor bill involves especially painful choices because of the vulnerability of its poor, handicapped, elderly and sick constituents.

Included in it are federal funds for mental illness, adult education, bilingual school programs, drug treatment and research programs of the National Institutes of Health into killer diseases.

Because of the anomalies of the appropriations process, Senate drafters of the labor bill have about $2.3 billion less to spend on discretionary programs than their House counterparts. For this and other reasons, Harkin's subcommittee could find no money for the new AIDS-care program, although the panel earmarked $490 million for fiscal 1992.

Senate critics, noting that the AIDS-care bill passed that body 95 to 4, find that unacceptable. "It's going to be a tough fight all the way," Lautenberg acknowledged. "But this is a rescue operation. There's a disaster sweeping the land."

Gay-rights organizations have been lobbying hard behind the scenes for the amendment, and the proposal also has revealed the muscle of big-city interests in the appropriations process. New York Mayor David N. Dinkins (D) reportedly has lobbied with Harkin. Lautenberg was instrumental earlier in making Jersey City eligible for coverage under the AIDS bill.

In addition, some hospitals that would likely be major recipients of the grants have lobbied with key appropriators. The House bill, passed before the president signed the AIDS-care measure, contains no specific funding for it, but is holding funds in reserve that could be used.

But other groups funded by the bill are determined to head off the cuts proposed in the Adams amendment.

"We recommend passing the bill as reported by the subcommittee," said Paul DelPonte of the Alliance for Aging Research.