There is inherent value to myths and fairy tales. This is not to say that you are wrong. I think that the school room incident you describe is sad and pathetic, but how else can it be handled? The Politically Correct schoolmarm could have just told the child not to tell his friends about Santa not being real (He isn't??) without resorting to calling the kid's father a liar. That was all I see wrong with the anecdote.
Reason being that there is much value to myth and fable. They are distilled lessons in socialization and morality, removed from context and abstracted onto a level that an immature mind can easily digest. A (typical) young child is not capable of reasoning on an adult level. Something can be wrong for very subtle and difficult to explain reasons. Witness the gun control, abortion, capital punishment and various other 'right vs wrong' issues with which our adult society grapples. A child's mind is usually incapable of grasping that something is wrong for metaphysical reasons. Most children don't even realize that something is wrong because it hurts someone else.
What children do understand is reward and punishment. Early on, children have no better reasoning capability than animals - I was a child, and I will attest to this. Fear of punishment is an effective deterrent to wrong action. Now, force-feeding fairy tales in place of truth is wrong, it's brainwashing. But, to a young mind, they are more easily understood than a philosophical debate, and much more effective than "Because I said so".
Haans Christian Andersen, the Brother's Grimm, Mother Goose and Aesop wrote (compiled) some valuable life lessons and morality plays to give children a framework for society. Hansel and Grettel for example, teach that children should obey their parents and not go off into strange places - and they should beware of kindly strangers giving them candy. (Halloween causes parents all sorts of grief, with all wrappers needing inspection and so forth - but Halloween aside, strangers with candy are invariably out to get your kid, so H&G is a worthwhile lesson)
Cinderella (the original, non-Disneyfied version) teaches that even in a dark and dreary life, there is hope if you are a good and honest person. Sure, Disney (the greatest threat to children's minds IMHO) has bastardized ancient fairy tales to the point where every little girl now wants to be rescued by a White Knight, but that's besides the point of Myth == Bad. It isn't. Disney == Bad, Myth == Good.
The Emperor's New Clothes serves to teach children about human herd mentality, and the syccophantic groupthink that permeates society. It encourages children to speak the truth instead of going with the crowd, but also makes them aware of the groupthink phenomenon and the reasons behind it. Flattering those in power, after all, is a good thing, even if there is not reason for it.
Stone Soup cautions against being too spellbound with handwaving to realize that you're being had. Too few children, especially in America, are familiar with this fable, and the marketting industry knows it!
Aesop's Raven, Mouse and Lion, Monkey and variety of other characters not only show idioms of wit and cleverness which the intelligent child will use to synthesize solutions to future problems. They also demonstrate human characteristics and their faults or benefits. Yes, pulling a thorn from a lion's paw is a kind deed, but it is also good to have powerful friends. The lesson is not self-serving, it is two-fold, and a good parent will make a point of talking with their child about the many dimensions of a Fable.
The origins of Santa and the Easter Bunny are very different. Santa hails from Saint Nickolas, a Russian orthodox monk who was known for his charity to widows and orphans. His is a lesson of selfless charity, and as long as children come to understand that this is the point of Christmas, then all is well; religion aside for the moment. The Easter Bunny is a vestigial remnant of European Paganism, and the Spring fertility rituals that the Christian Church subplanted with Easter. Easter, much like Christmas, is time-shifted from the original date to sway the heathen towards the light, after all. The Church is one of the most successful marketters of them all. Anyway, the bunny and the egg are both symbols of ferility, so they were used by the Pagans as such. When the Christians came, they decided to let the pagans keep their symbols, but to make them also eat some sugar-coated religion along with their chocolate bunnies and marshmallow eggs.
Then there are the old Greko-Roman myths which are the very foundation of Western culture. There are immense lessons on vice and virtue, as well as human character, in the writings of Homer and his ilk, as well as the mythos around which those tales are spun. The omnipotent whim of the gods teaches people to be humble and accepting of the events in their life, since many things are beyond their control. The stories of heros and tragic figures teach that the virtuous succeed and the viceful perish. Not necessarily true, but it makes for a more civil society, don't you think?
The Labors of Heracles, in particular the cleaning of the royal stables, teaches that not even the strongest man in the world can solve all his problems by brute force. It reminds children that using one's intellect will save them much effort.
The entire mythos of Hades is full of value. From an explanation of why the seasons change (granted, totally pointless scientifically, but entertaining and full of human value) to the Sissiphusian futile effort which one hopes children would recognize in their own life.
So ultimatelly, I think that myths, fables and such are of immense value to society. They teach. They deliver the wisdom of many generations in easily digestible chunks which allow the next generation to not reinvent the wheel, so to speak, but rather to move forward with building on that experience.
Though I think that you do bring up a very valid concern, the political correctness of perpetuating fairy tales as truth, not as symbols. Telling kids that Santa is real is not healthy for maturing minds. Telling them that he symbolizes certain good things, is a valuable lessorn.
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