Only if it goes both ways. If I can't respond to my managers blunt candor with "the reason we're so far behind is because you suck at time management and promised the customer two features we hadn't even begun to plan for" without fear of being reprimanded or punished then blunt candor isn't very effective.
First, if you ever said that to your boss you should definitely be fired.
Second, that's operational information, not performance feedback.
Third, it's not your prerogative to tell your boss what he's good or bad at. They give you the review, not the other way around.
Good bosses know this and like honesty. Bad bosses fire people for stating the truth and wind up with shit.
However I will agree that saying "You suck at.." is pretty bad, and it would be equally bad coming from a boss.
Some shops have "360 degree reviews", where you need to get reviews from your colleagues and people you serve (or to use an ungenerous phrase, your underlings), not just your boss.
Personally, blunt candor can work as well. I do not let anything slip, if I think someone needs some direction or coaching it basically happens in realtime. There's really no need for a formal review if feedback is constant. Sometimes the feedback can be more general, I feel someone needs some hints I just give it to them.
I don't make it personal and don't expect people to take it personally, it's jarring at first but quickly it just feels really quite normal.
Technically, there are still room for performance reviews ... but if as a manager you're telling someone in a review something they're hearing for the first time then you've failed. They should know right away.