It's not really a procedural vs. functional distinction - I'm fluent in Haskell and had the same initial reaction as cwarren. Rather, Arc is "weakly typed". The same bit of program data can be interpreted as different types depending upon the context where it's used. (This is distinct from strong-but-dynamic-typing like in Scheme or Python, where you have to explicitly convert between types.) It joins the club of Perl, PHP, and assembly in this regard.
I mentioned elsewhere on this thread that I think this is the right design decision given Arc's design principles, but that those design principles are flawed. In my experience, bugs resulting from implicit coercions are rare, but they're also really difficult to track down. That was a major reason I switched from PHP to Python.