The Pentagon is reviewing the new Defense Strategic Guidance it released last year in light of fiscal constraints, but said it has not gone as far as to end the so-called pivot to Asia that is central to that strategy.

Defense Secretary Chuck Hagel directed senior leaders last week to “conduct a review to examine the choices that underlie the Department of Defense’s strategy, force posture, investments, and institutional management–including all past assumptions, systems, and practices,” Pentagon press secretary George Little said yesterday in a statement.

Deputy Defense Secretary Ashton Carter is conducting the review with Chairman of the Joint Chiefs of Staff Army Gen. Martin Dempsey and the other Joint Chiefs. They have a tight deadline, as Hagel has requested their conclusions be delivered to him by May 31.

This new “Strategic Choices and Management Review” will “define the major decisions” that officials determine will be needed over the next decade “to preserve and adapt our defense strategy, our force, and our institutions” under a range of future budget scenarios, Little said. The review “will take the 2011 Defense Strategic Guidance as the point of departure, and it will examine whether the assumptions made in that strategy are still applicable,” Little added.

The spokesman, though, dismissed a news report that said Obama’s pivot-to-Asia strategy is “officially dead.”

“Not true,” Little wrote on Twitter. “The starting point for this review is the defense strategic guidance, which prioritized the Asia-Pacific.”

That current strategic guidance–which President Barack Obama himself unveiled in January 2012–calls for strengthening the U.S. military presence in the Asia-Pacific region while shrinking the size of conventional ground forces as troops draw down from Afghanistan.

After Pentagon brass complete the newly announced Strategic Choices and Management Review, Hagel will use its conclusions to frame his guidance for the fiscal year 2015 budget next year, Little said. The findings also will be the “foundation” for the massive Quadrennial Defense Review due to Congress in February 2014, he added.

The range of budget scenarios that will be considered in the new Strategic Choices and Management Review, unavoidably, include budgeting for “sequestration”–the $500 billion, decade-long reduction to planned defense spending that officially started on March 1. Some lawmakers and Obama want to stop the sequestration cuts, but they have been unable to agree on an alternative plan to trim the federal deficit.

Dempsey said yesterday at a Washington think tank that he’s “hopeful, but not all that optimistic, that both (sequestration’s) magnitude and its mechanism will be diffused in some future budget deal.”

“But In the meantime we have no choice but to prepare for its full effect, which is of course our worst-case scenario,” he said at the Center for Strategic and International Studies.

He said when he met last week with the Joint Chiefs and combatant commanders they did not voice a “chorus of decline.”

“They have the courage to make the difficult choices about our investments, about our people, and about our way of war,” Dempsey said, noting the officials have all served during previous military drawdowns.

He said the military officials need to “seize the moment” and think and act differently, but can’t do so alone.

“We need the help of our elected officials to give us the certainty, the flexibility and the time to make change,” he said. “If we can get the reforms to pay and compensation we need–and we need them–and if we can get rid of weapons and infrastructure that we don’t need, then we can begin to restore the versatility of the joint force at an affordable and sustainable cost.”

“As I stand here today, I don’t yet know whether or if or how much our defense strategy will change, but I predict it will,” Dempsey said. “We’ll need to relook at our assumptions, and we’ll need to adjust our ambitions to match our abilities. And that means doing less, but not doing less well.”