Reining in financial firms’ compensation to reduce excessive risk-taking — and fend off a public backlash over bankers’ pay — is fast rising to the top of the regulatory reform agenda. But there are plenty of grounds for skepticism that any of the proposals on the table will lead to significant change.

President Barack Obama drew attention to the problem this spring on, of all places, the Tonight Show, when he told Jay Leno, “Who in their right mind, when your company is going bust, decides we’re going to be paying a whole bunch of bonuses to people?”

Then New York State Attorney General Andrew Cuomo began digging into Wall Street’s bonus culture. It emerged that Citigroup, which received $45 billion in federal government funds under the Troubled Asset Relief Program, paid out more than $5 billion in bonuses in 2008 — the same...