Just in time for the holidays, here's the last installment in a fanciful look at how the current economic woes might affect North Pole Toys LLC.

WASHINGTON - The proposed Santa Claus congressional bailout hearings took a surprising turn yesterday as the Tooth Fairy and Easter Bunny appeared and testified.

Claus, longtime president of North Pole Toys LLC, had begged Washington for an $18 billion bailout to keep his sinking holiday enterprise afloat. By day's end, Claus unexpectedly accepted a significantly smaller bailout.

Many on Capitol Hill grilled Claus about his spending and the merits of giving financial support to his company, which largely measures its profits in hugs and joy.

The Tooth Fairy and Easter Bunny both testified in favor of the bailout, and asked if they could be included in a federal rescue.

"We've never been through a time like this before," said Ms. Fairy, whose wings fluttered furiously throughout the hearing. The 4-foot-3 pixie said her 496-year-old business, which mainly puts money under the pillows of sleeping children in exchange for their baby teeth, is also struggling.

"I'm taking heavy losses. I know you all keep mentioning the Great Depression, but I didn't have to shell out that much money back then. Most of the kids didn't have teeth, you know," she said.

Rep. Dennis Kucinich, D-Ohio, asked Ms. Fairy if she'd wave her magic wand and solve the problems faced by the Beloved Big 3.

She scoffed at that. Kucinich later excused himself when Ms. Fairy noted that she and the congressman had similar facial features and were about the same height.

Sen. John McCain, R-Ariz., made his first appearance at the hearings yesterday and declined to support any bailout measures.

"My friends, the fundamentals of imaginary economies are strong. They don't need our help," he said.

Claus told McCain Christmas was in danger of "going the way of the woolly mammoth and, to a lesser extent, Vanilla Ice" if his firm didn't receive federal assistance.

That led to a heated exchange.

"Have you considered any mavericky measures?" McCain asked, to which Claus replied, "What the heck does that mean?"

Silence filled the room for several minutes while both men - former high-school classmates - glared at each other. The Easter Bunny twitched nervously and apparently lost control of several bodily functions during the staredown.

More chaos ensued when Sen. John Kerry, D-Mass., suggested a $50 billion bailout package, an offer he rescinded about 30 seconds later.

The hearing drew to a quick close when Senate Majority Leader Harry Reid offered the Beloved Big 3 $500,000 in federal money if they agreed "to just go away already."

After a brief discussion with North Pole administrators, the Tooth Fairy and Easter Bunny, Claus leaned toward his microphone and said: "OK. Done deal."

A sigh of relief echoed through the congressional chambers. "Excellent," Reid said. "I hope this money will help you all get back on track."

CLAUS, the Tooth Fairy and the Easter Bunny exchanged laughter and high fives. "This is great," Claus said. "I can't believe they fell for it."

Reporters followed Claus as he and his cohorts walked out of the Capitol, only to come face to face with a presidential motorcade wending its way past the building.

The fleet of limos and SUVs slowed to a stop, and Claus strolled over to a sleek, black vehicle. Photographers snapped pictures as one of the occupants rolled down a tinted window and asked Claus a question.

It prompted Claus to chuckle loudly.

"Why, W.," he said, "of course you're getting coal again this year!"*

David Gambacorta is a Daily News reporter.