In times past, foundation was much heavier than today and it was made with a lot of oils that clogged pores and caused pimples. This isn't true today, modern foundations come in oil-free formulations that don't clog pores as much, and in fact, some come with skin treatments added so they actually treat acne, redness, aging, etc. Some also contain SPF to help protect skin from sun damage. So no, foundation itself isn't bad for your skin.
But if you have persistent acne that isn't clearing even though you are on a treatment program, it is often recommended that you stop wearing makeup to see if this helps. Also, if you are not really careful to get ALL of your makeup off each night, this is bad as it will cause pore clogging and nasty breakouts.
of course it's bad for your skin! you werent born with foundation on your face so without a doubt it is and will always be a foreign substance to your skin. we all know this, however, foundation and cover up has come such a long way. my strong advice would be to start off little and work your way up in coverage. i constantly see women wearing a full coverage foundation ( women who have close to perfect skin that is) b/c they think that that's the way to go when you want a flawless finish. have a color specialist diagnose exactly what he/she would cover up and what products they would use if they were to do makeup on you and go from there. dont forget to read the ingredients!