Need help understanding proof of theorem
(The Principle of Mathematical Induction) For each positive integer
, let
be a statement. If
(1)
is true and
(2) the implication
If
, then )
is true for ever positive integer
, then
is true for every positive integer
.
Proof:
Assume, to the contrary, that the theorem is false. Then conditions (1) and (2) are satisfied but there exist some positive integers
for which
is a false statement. Let
is false 
Since
is a nonempty subset of
, it follows by the Well-Ordering Principle that
contains
. Since
is true,
.
Here I am lost:
Thus
and
. Therefore,
and so
is a true statement. By condition (2),
is also true
and so
. This however, contradicts our assumption that
.
Question: What is
?