Undeclared Republican presidential hopeful Ronald Reagan yesterday wowed a largely conservative crowd of independent business people with a denunciation of populist trends and a call for a return to more states' rights.

A government program once launched is the closest thing to eternal life we'll ever see," Reagan told the 2,000 delegates at the convention of the National Federation of Independent Business. NFIB has about 600,000 members across the country.

Reagan said people often ask what can government do about the nation's economic problem. "The government has already done too much about it," Reagan said.

The velvet-voiced Reagan stroked the crowd with numerous jokes and appeals for a return to the country's founding principles. Throughout the federation's lunch, autograph seekers rushed the former governor of California, nearly jamming doorways as Reagan tried to leave after his 40-minute talk.

Earlier in the day, presidential contender Sen. Robert Dole (R-Kan.) told the crowd that he favored indexing taxes to the Consumer Price Index and a constitutional amendment to balance the budget. He also criticized both Sen. Edward M. Kennedy's and President's Carter's national health plans and said they wouldn't get even 25 votes in the Senate.

"I don't think you want to federalize medicine," Dole said. "No, no," the crowd chanted back.

"Neither Kennedy nor Carter has enough votes to get their bills out of Congress," Dole said, his fist chopping the air.

Many people favor price controls on hospital costs, Dole said. "But you wouldn't want price controls on you," Dole told the business people.

"No, no," the audience murmured back.

Dole said that last March he introduced a catastrophic health insurance and medicare plan that would expand protection against catasrophic illness and mandates that catastrophic protection be provided by employers for full-time employes. A limited tax subsidy would be provided for small employers.

Catastrophic illnesses are those that would financially wipe out a person with a long-term illness, Dole said.

Reagan did not attack Kennedy or Carter, but the goverment in general. Reagan said that Americans are being governed more by civil service bureaucrats than elected officials and are being tax more for the puposes of penalizing industry and redistributing income than for revenue source.

Reagan, who filled his speech with jokes, one liners and cleverly turned phrases, also attacked goverment regulation and rhetorically asked the crowd why more of them did not "withstand the arrogance of government" regulations.

Another Reagan target was government spending and the billions of dollars in the federal budget.

"If you gave your wife $1 billion and told her not to spend more than $1,000 a day, she wouldn't be home in 3,000 years," Reagan said.

Reagan's talk, though received by standing ovations and applause seemingly every minute, was not as effective as those of former governor John Connally the day before or Sen. Edward M. Kennedy on Monday, many members said after Reagan's address.

The business convention, held every four years before election year, has become a forum for presidential aspirants.

During the three-day convention which ended yesterday, the business people heard from Kennedy, Rep. Jack F. Kemp (R.N.Y.), who said he has closed no doors to running for president although he is focusing on the upcoming New York Senate race; Rep. Phillip Crane (R-III); Connally, Dole and Reagan.

President Carter was invited t address the group and, until late yesterday morning, spokesmen for the organization said they had not recieved an answer from the White House. A White House spokesman said later Carter did not have time in his schedule to allow an appearance.

Stuart Eizenstat, Carter's chief domestic advisor, had been schduled ahead of time to address the group and recieved polite applause. Eizenstat explained the number ways that Carter has helped small business through efforts to deregulate the airline, railroad and trucking industries, stop government waste and end over-regulation. CAPTION: Picture 1, Ronald Reagan denounced government programs an ineffective during his speech yesterday to the National Federation of Independent Business. AP; Picture 2, Sen. Robert Dole criticized the Kennedy and Carter health bills in his address yesterday to the National Federation of Independent Business. By Larry Morris-The Washington Post