Nov. 23 (Bloomberg) -- News that Warren Buffett is looking for opportunities in Japan is as good as it gets for a nation that has had an awful year.

All Japan needs to do is convince the most famous value investor that it’s deserving of his money. Yet a curious juxtaposition involved in Buffett’s first-ever Japan visit showed why that’s easier said than done.

Buffett was touring a tool plant in Fukushima prefecture, where a nuclear-power plant damaged by the tsunami in March has contaminated the surrounding area. There, he was asked about another calamity putting Japan in a harsh and negative spotlight: the Olympus Corp. scandal. The Berkshire Hathaway Inc. chairman said: “The fact that Olympus happens here or Enron happens in the U.S. doesn’t affect our attitudes at all.”

Think about it, though. The most-watched market guru is standing near one crisis caused by political corruption and being queried about another involving corporate malfeasance. At the heart of both storylines are growth-killing dynamics that have long given Buffett and his ilk pause. While different in their details and magnitude they show how Japan may be too wedded to the past to thrive in a world of intensifying competition.

The Yakuza Question

Olympus, as venerable a name as there is in Japan, demonstrates the point. Investigators want to know what happened to at least $4.9 billion they say is unaccounted for at the camera maker. Of all the bizarre questions surrounding this sordid tale, the role of organized crime groups, or yakuza, is the most tantalizing. Police are looking into how much of the missing cash went into the pockets of these gangs.

“No one can be sure what will be found until the digging is done,” says Jake Adelstein, author of the 2009 book “Tokyo Vice” and a well-known crime reporter in Japan.

With their full-body tattoos and amputated fingers, the yakuza have long held a unique place in the public imagination. Unfortunately, that goes for Japan’s economy, too. Adelstein calls the yakuza “Goldman Sachs with guns” because of the prowess with which their groups’ roughly 80,000 members infiltrate companies through extortion and intimidation.

Olympus is the latest reminder of the extent to which the yakuza is intertwined with the corporate culture, and it’s hardly the only household name to get ensnared. In 2009, Fujitsu Ltd. ousted its president for alleged ties to “antisocial forces,” a euphemism in Japan for organized crime. The question is this: If Olympus was mixed up with such sinister forces, which other Nikkei 225 Stock Average companies are?

Mysterious Payoffs

Prime Minister Yoshihiko Noda is worried that Olympus will sully Japan’s reputation as a well-regulated market economy. Michael Woodford’s travel schedule shows why it may be too late. The former Olympus chief executive-turned-whistleblower forwarded to the whole Olympus board some letters detailing his concerns about mysterious payoffs before he was fired last month. Then Woodford left Japan, fearing for his safety. This week, he will be under police protection as he returns for the first time to meet with investigators.

Seriously? In a Group of Seven nation? Yes, these things can still happen in Japan thanks to a corporate and political aversion to digging to weed out nefarious interests. A compliant media can only make that worse.

A similar conclusion can be drawn from events in Fukushima more than eight months after a record earthquake. It was incestuous ties between government bureaucrats and the power industry that left high-tech Japan so vulnerable to the low-tech ways of Tokyo Electric Power Co., the owner of the damaged Fukushima reactor.

Organized Corruption

When we think of the mob, we don’t tend to think of publicly traded utilities like Tepco. But how can anyone look at the ways politicians enabled Tepco and its shocking safety lapses over the years and not call it organized corruption? How can the government, knowing what it does now, rally around the nuclear industry?

Woodford’s soul mate in politics, former Prime Minister Naoto Kan, was shown the door in August for asking hard questions. Kan wanted to hold Tepco accountable for the radiation leaking into Tokyo’s food supply. Noda quietly let matters return to the status quo ante for the nuclear-industrial complex that Tepco represents. The losers are the Japanese people who worry about another Chernobyl when the next giant earthquake hits.

All this shows how Japan is shunning the change needed to compete in an age when China sets the pace. Just as illustrative is the ability of rice farmers to imperil passage of international-trade deals. And then there’s corporate Japan with its poison pills, takeover defenses and protection of inefficiencies.

Buffett isn’t the only investor searching for bargains in Japan, but he’s by far the most important. Japan’s markets have been beaten down since the earthquake that forced Buffett to delay his Japan trip. And there are great companies in Japan.

The problem is that too little is taking place in the halls of power to clean up an economic system that has lost its way. The shenanigans at Olympus and Tepco show how much the opacity of the past is constraining what should be a bright future. That won’t be lost on savvy investors like Buffett.

(William Pesek is a Bloomberg View columnist. The opinions expressed are his own.)

To contact the writer of this article: William Pesek in Tokyo at wpesek@bloomberg.net

To contact the editor responsible for this article: James Greiff at jgreiff@bloomberg.net