Paganism is very broad, but if you are interested in European based practices which is where Santa originated… then this is what we share with our child:
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Santa is a variation of the God, as the Greenman. In a popular tale of the Holly King and Oak King illustrates the Solar God’s cycle through the year. The Holly and Oak king battle for rulership over the year. At summer solstice the Holly King wins and slays the Oak King. At winter solstice the Holly King has grown old (Santa image of old man, perhaps with a crown of holly) and is slayed by the Oak King to ruler over the light half of the year. The oak is often represented as Mistletoe which grows on oak trees. Holly and mistletoe are long sacred plants in European lore, especially in the winter. The oak and holly king are 2 sides of the same face/ God. Each needs the other to make keep the cycle going.
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Santa is also seen as a “ jolly old elf” toy maker, who has elves helping him to make toys for all the kids. The part about him coming into your home through the chimney is a testament to fae in general as well as spirits, who are usually thought to enter/exit a home through the chimney.
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I quit like the general/modern image of Santa Claus. In a time when most male role models are young, muscular and only saving the world through fighting. Santa shows generosity, kindness and an honor of elder wisdom. Something I think we should encourage in our own lives.
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So we definitely “do” Santa in our home, as most Americans do. We hang stockings, DS (age 8) visits the mall Santa and we give DS gift from Santa. We will do this as long as he is interested. When he “figures it out” we will let him know that the spirit of Santa never dies and is always alive in our hearts.