Here's an explanation of the Caga tío.
On Christmas day or, depending on the particular household, on Christmas eve, you put the ‘tió’ partly into the fireplace and order it to “poo”. To make him “poo”, you beat him with sticks, while singing various songs of Tió de Nadal.
The tió does not drop larger objects (of course!! Can you imagine?), it does leave candies, nuts and torrons. When nothing is left to “poo”, it drops a salt herring, a head of garlic or onions. What comes out of the ‘tió’ is a communal rather than individual gift, shared by everyone present.
After hitting it softly with a stick during the song it is then hit harder as people say “¡caga tió!”. Then somebody puts his hand under the blanket and takes a gift. The gift is opened and then the song begins again.
Cagar is the verb "to shit" in Spanish and apparently in Catalan. If we beat effigies of politicians, will we get our country back as gift? Just asking.