In Catalonia, as well as in the rest of Spain and in most of Italy and Southern France, traditional Christmas decorations consist of a large model of the city of Bethlehem, similar to the Nativity scenes of the English-speaking world but encompassing the entire city rather than just the typical manger scene. The caganer is a particular feature of modern Catalan nativity scenes, and is also found in other parts of Spain and southwestern Europe, including Salamanca, Murcia (cagones), Naples (cacone or pastore che caca) and Portugal (cagöes). Accompanying Mary, Joseph, Jesus, the Shepherds and company, the caganer is often tucked away in a corner of the model, typically nowhere near the manger scene. There is a good reason for his obscure position in the display, for "caganer" translates from Catalan to English as "pooper", and that is exactly what this little statue is doing — defecating.
Insert South Park reference here.
Via Pandagon, who takes glee in the fact that Bill Donohue is apoplectic over these little shitter boys.