Make two batches for Nutcracker Cookies.
Combine meringue powder, sugar, and water in the bowl of an electric mixer fitted with the paddle attachment. Mix on low until the icing is smooth and thick, 10 to 12 minutes. The consistency may be adjusted by adding water, one tablespoon at a time, if desired. Using a toothpick, mix in very small drops of the gel-paste food color; stir by hand with a spatula until combined.