Weirdly enough, the original song is from an Italian soft-core porno movie called "Sweden - Heaven and Hell". Here is the link explaining the origins and incorporation into the Muppet song:
“Mahna Mahna”: How a ditty from a soft-core Italian movie became the Muppets’ catchiest tune. - Slate Magazine
Either Jim Henson and his staff were in the dark as to the true origins of the song or they were perpetrating a clever inside joke for the adults "in the know" to enjoy while they were forced to listen to the Muppet songs ad nauseum.
RIP, JH!
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