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The City of Bethlehem, PA capitalizes on their obvious ties to Christianity as a tourist draw. They have the "big star on the mountain" and bill themselves as Christmas Town, USA. If they separate church and state there, they'll lose money.
(I admit to thoroughly enjoying the ChristKindlMarkt (where they sell the baby Jesus every year) and the obligatory side trip to the Moravian Book Store, even if it is goddamn impossible to park in that town)
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