That's not whitewashing. If Barret becomes white, that's white washing. It's a literal term. Or the opposite which is more prevalent lately. I dont think striving to be politically correct really has a term. Japanese dont care about being politically correct though.

Japan has never veered away from what others would consider taboo. Rewind back to 2001. The trade centers. While there was supposedly scene about the trade centers in MGS2 and it was taken out, the game still focused largely around a terrorist organization.

We also have Square never shying away. Just because the Western world is so squeamish about some stuff, dont count the Japanese. They wont portray an actual event, but they wont shy away. SE always makes their games toward their JP audience first and foremost. The only issue I see is Nomura can be eccentric at times. And he may change the game completely for his own reasons.