January 10, 1981

Alexander M. Haig Jr., President-elect Ronald Reagan's choice for Secretary of State, warned the Senate Foreign Relations Committee today of the dangers presented by uncontrolled Soviet military power. And he responded to occasional critical questions about the Watergate scandals and other issues from his days in the Nixon White House. In his opening statement to the committee as his confirmation hearings began, Mr. Haig said that ''unchecked, the growth of Soviet military power must Main points of testimony, pages 9-10. eventually paralyze Western policy altogether.'' But, he continued under questioning: ''There are things worth fighting for. We must understand that. We must structure our policy under that credible and justified premise.''

Twenty persons were killed and 13 others were missing and feared dead early yesterday in a fire of undetermined origin that roared through a two-story brick and stucco home for the elderly in Keansburg, N.J. At least 78 of the 111 residents escaped, but 17 were injured, two critically. The heat of the blaze was so intense that it drove back firemen trying to rescue residents. Many of those who died were roused from sleep by staff members in time to get out, but returned to their beds or wasted critical seconds trying to dress as the flames drew near and enveloped them, the authorities said. Confusion in the Smoke Some of the victims were described as senile. Others were said to have been sedated by medication and virtually helpless or too confused or terrified to understand what was happening in the din of jangling alarms and billowing smoke and flames.

For the last 18 months there has been a sharp dispute among Federal prosecutors in New York and New Jersey over the undercover methods used in the Abscam investigation, according to an unpublished internal Government memorandum. The conflict between the United States Attorneys' offices in Newark and Brooklyn centered on the way agents conducted their undercover tactics with Senator Harrison A. Williams Jr. of New Jersey. According to the memorandum, the New Jersey prosecutors were concerned about issues that included the possibility of entrapment. That question could be crucial in appeals by those convicted in the investigation into political corruption. and in Senator Williams's defense. 'An Odor to It,' Judge Says On Wednesday the judge presiding in Washington at the Abscam trial of former Representative Raymond F. Lederer of Pennsylvania was convicted of bribery and other charges in Federal Court in Brooklyn. Page 27.

Producer prices continued to rise along a broad front in December, with declines in food prices more than offset by brisk advances in energy, capital equipment and other goods, the Labor Department reported today. Producer prices, those charged for finished goods ready for sale to the consumer, rose by six-tenths of 1 percent for the second consecutive month. This key index thus finished 1980 11.7 percent higher than it stood a year earlier, compared with a 12.6 percent advance in 1979. Although December's rise was less than half that recorded in five other months last year, economists said they found little in the latest figures to indicate the overall inflation rate was falling.

On the eve of another test of wills with Poland's independent labor union, a leader of the Communist Party appeared unexpectedly on television tonight to urge a ''reasonable solution'' to outstanding disputes. Mixing conciliatory language with criticism of ''counterrevolutionary forces'' and spreading ''anarchy,'' Stefan Olszowski, a member of the nine-man Politburo, suggested that an eventual compromise was possible with the Solidarity trade union organization over the question of the five-day workweek. Two nights ago, the union, accusing the regime of dragging its feet on the accords reached last August in Gdansk, said union members would not work on Saturdays. The Government countered with an offer of alternate Saturdays off and said that workers who do not work tomorrow would lose a day's pay. Solidarity has suggested that it might call strikes if workers who do not show up are penalized.