I wouldn't call Lisp a functional language. Historically it's not functional, and in practice it usually isn't functional either.
When I hear "functional", I usually interpret it to mean languages influenced or derived from the ML family of languages. Notable features of these languages include algebraic data types, match expressions, emphasis on monadic operations (fold, scan, map, etc), support for TCO, and a expressive static type system (though unfortunately not necessarily supported higher kinds), and a discouragement of mutations.
Common Lisp doesn't really emphasize any of those things, and Scheme only a couple.
Just because you need a red annotation doesn’t mean they don’t have TCO. Most people consider Scala to have TCO, and you need rec annotations as well. Also I said mutation is discouraged for ML languages, not that it hard. Point taken about the imperative control structures, though.
Lisp, while somewhat functional.in preferred style, is an impure functional language and, as such, supports, fairly easily, imperative code with mutable state, with all the pitfalls that involves.
It's also usually untyped, and I think the hard to write bad functional code line is mostly true of statically typed pure functional code.
