Been doing some reading on Santa Claus. It is actually an extremely interesting topic.
It is interesting and it is so complicated that one can write whole books about it, but here is a short version that covers the main points of what I have learned so far (by all means, correct me if I am wrong about anything):
The modern Santa Claus as he appears in North America is based on a couple of different sources. The most recent is Saint Nikolas, who was the bishop of the city Myra in the 4th century in what was then Greece and what is now Turkey. He was known to have given gifts to poor children. There exists a holiday in his honor in much of Europe which is on the 6th of December. Saint Nicolas comes and gives gifts to well behaved children, and his assistant "Servant Ruprecht" brings wooden rods with which he beats the non-behaved children.
The tradition was carried to the United States by immigrants from Holland. In their language the name of Saint Nicolas is pronounced "Sinterklaas" which became Santa Claus in English. Santa Claus both punishes and rewards, so there isn't an additional figure such as Ruprecht in the USA.
That does not explain why the date is 25th of December though, and it doesn't explain the other features of Santa Claus, such as the reindeers and that he lives on the North Pole. And here is where it gets interesting.
Far before the 4th century, so before there was a Saint Nicolas, there already existed a holiday on the 25th of December, which was called Yuletide and which was dedicated to the Germanic god Odin (father of gods). It was believed that on the 25th of December he lead a procession of spirits which went from house to house and gave gifts to children. He was very powerful and could see everything that people did ("he knows if you've been bad or good"
. Pictures of him showed him as an old man with a long white beard. It is very likely that this is the reason the date was moved to the 25th. What is funny is that Santa Claus now comes on the 6th of December and on the 25th of December in many parts of Europe. The American Santa is referred to as the "Christmas man", while Saint Nicolas is simply "Nikolaus".
But there is more. Odin rode a horse and not a reindeer. The reindeers and the fact that Santa lives at the North Pole likely have a different origin: In most of Eastern Europe there is an old tradition which says that on New Years Eve a being known as "Father Frost" come and brings gifts. He leads a procession of reindeers and it is likely that the reindeers are based on this tradition. Also, Father Frost is believed to be an embodiment of the Winter. This is likely the origin of the belief that Santa lives at the North Pole.
What is also interesting is that the modern design of Santa Claus with the red fur coat, was influenced by the Coca Cola company who made him a trademark in 1931. Older depictions of Saint Nicolas have a different design (he wears bishops clothes).
In any case, even though the origins of the details of the modern Santa are very complicated, it is clear that for literally thousands of years, in many different places of the world, people in one way or another have believed in a powerful old man which shows up in the deepest winter to bring gifts and have held a celebration in his honor.
And now some pics.
This is father frost:
These are illustrations of Saint Nicolas /Sinterclaas:
Here is Odin:
Here is modern Santa:
= new reply since forum marked as read
bass players do tend to be odd ducks 
Thank you for that information, and for the pics. 
Thomas Nast was the first to clothe Santa in a red suit in the late 1800s. Norman Rockwell painted Santa in red in 1921. By the time Coke got around to their popular ad campaign, most people were already associating Santa with wearing red.
Thomas Nast picture:
Rockwell's Santa:
I guess it is possible to associate pretty much any myth with hallucinogenics
Oh, and it is no surprise that Sinter looks like a pope, since he was a bishop 
