If it is done by a knowlegable breeder it can be very helpful in strengthening desireable traits or in developing a "bloodline" with distinguishing characteristics. I think that it can be a cause of tempermant issues as well as other defects but those would be culls and should not be allowed to take the breed in a wrong direction. The main reason, IMO, for temperment issues in this breed would be BYB without the knowledge or concern for breeding the best representatives. Indiscriminate breeding has done this breed a huge amount of damage.
"You see, there was a time in our country where courage was valued, and where the pit bull symbolized that courage, and it was a better time for us all as well." -California Jack