In the latest twist in California’s raucous gubernatorial recall election, the Oracle of Omaha has signed on with the Terminator of Brentwood. Warren Buffett, billionaire investor, chairman of Berkshire Hathaway Inc. and outspoken Democrat, has agreed to be Republican gubernatorial candidate Arnold Schwarzenegger’s senior financial and economic adviser, the film star’s campaign announced yesterday.

“I have known Arnold for years and know he’ll be a great governor,” Buffett said in a statement released by the campaign. “It is critical to the rest of the nation that California’s economic crisis be solved, and I think Arnold will get that job done.”

Schwarzenegger said yesterday in a statement that Buffett will be a “huge help to me” in formulating economic positions, and hailed Buffett as “the greatest investor ever, my mentor and my hero.”

The actor has said he entered the race to replace embattled Democratic Gov. Gray Davis in order to restore the state’s listing economy, but he has not indicated how. Schwarzenegger’s campaign said yesterday Buffett would help the candidate assemble prominent business leaders and economists to flesh out a plan for the Golden State’s revival. A campaign aide made it clear that pulling in Buffett was Schwarzenegger’s idea, not Buffett’s.

“Buffett is obviously a heavyweight who will give Arnold some credibility with voters on economic issues,” Daniel Weintraub, the Sacramento Bee’s senior political columnist, wrote on the paper’s Web site.

But California Democratic political consultant Bill Carrick said he was mystified by the choice of Buffett. As one of the leading proponents of requiring that companies record stock options as expenses, Buffett is widely reviled in Silicon Valley, he said. And tax-cut enthusiasts who dominate such Republican bastions as Stanford University’s Hoover Institution already have railed against Buffett’s positions opposing President Bush’s tax cuts, particularly his calls to eliminate the estate tax and slash taxes on dividends.

To less well-heeled voters, Buffett’s name may mean next to nothing, Carrick added. “The pluses are not that strong and the negatives among targeted audiences are very strong,” he said. “Which leaves you all the more perplexed. Why do it?”

What Buffett gets out of the deal is unclear, and his office said yesterday he was unavailable for comment. The two are “good friends,” said Paul Wachter, another Schwarzenegger adviser and president of Main Street Advisers, an investment firm in Santa Monica. Last December, Buffett gave the famed strongman a $75 coffee-table book, according to the candidate’s financial records.

Buffett does have a history of personally stepping in to rescue an investment that is in obvious trouble, and California qualifies. Berkshire Hathaway, an investment holding company, has a considerable stake in the state. Last year, its MidAmerican Energy Holdings Co. bought a major natural gas pipeline that delivered 900 cubic feet of gas a day from southwest Wyoming to Southern California, then promptly invested $1.2 billion to double its capacity, according to Berkshire Hathaway’s 2002 annual report.

Also last year, Berkshire Hathaway bought Prudential California Realty, which the holding company touts as the largest real estate agency in Los Angeles, Orange and San Diego counties.

In 1971, Berkshire bought See’s Candies — self-described as “California’s Famous” — for $25 million. It has earned the company $1 billion since then. The annual report lamented the “terrible results” of its subsidiary Cypress Insurance Co., which underwrites the state’s workers’ compensation operation. “There we have work to do,” the report states.

Berkshire’s investments elsewhere include a large stake in The Washington Post Co., and Buffett sits on its board of directors.

Campaign spokesman Rob Stutzman said Buffett’s decision may mark his first formal foray into electoral politics. Buffett has contributed to federal House and Senate campaigns in the past — almost always to Democrats — but by the standards of big-time Washington moneymen, Buffett’s and Berkshire’s donations are paltry, never exceeding $1,000 at a time, according to the nonpartisan Center for Responsive Politics.

Their beneficiaries have included Sen. Hillary Rodham Clinton (D-N.Y.), who received two $1,000 donations in 2000; former senator Bill Bradley, who challenged Al Gore for the Democratic presidential nomination; and numerous other Democrats. Only one Republican, moderate Rep. Christopher Shays (Conn.), has received Buffett’s largesse.

If that history does not rile California’s conservative Republican base, Buffett’s outspoken opposition to President Bush’s economic policies may. Buffett recently wrote that Bush’s tax cuts have lowered his personal effective tax rate to 3 percent while leaving his receptionist paying 30 percent of her income in taxes.

“Supporters of making dividends tax-free like to paint critics as promoters of class warfare,” Buffett wrote in a piece published on The Washington Post’s opinion page. “The fact is, however, that their proposal promotes class welfare. For my class.”

But Buffett is a political pragmatist. Buffett and other Berkshire shareholders had made contributions in the past to population-control and reproductive-rights organizations through the company’s charitable giving program. But Berkshire scrapped the 22-year-old program last month in response to threatened boycotts by antiabortion groups.

Stutzman said Buffett’s opinions and past contributions do not concern the candidate, and his prominence “demonstrates Arnold is able to attract leading authorities in the world.”

Buffett and Schwarzenegger met seven years ago at a lecture the investor was giving in Los Angeles, a campaign aide said. They connected again when Berkshire Hathaway purchased NetJets Inc., a corporate jet firm in which Schwarzenegger owns a stake. Last year, the two attended an economic conference sponsored by NetJets at the British estate of Lord Rothschild. Berkshire Hathaway owns about 1.7 million shares of The Washington Post Co. Class B common stock, or about 18.1 percent of the publicly traded shares, according to The Post Co.’s most recent proxy statement.