Not true - although Spain have historically been dominated by players who play and have played exclusively in Spain, their improvement to best in the world (having, like England suffered decades of under-achievement) coincided with a much more international approach, with a significant number of players having experience outside of Spain.
So to look at their winning squad in 2012, they had players playing at that time in top teams in England, Italy and Germany, as well as Spain. And more still with experience outside of Spain, for example:
Albiol, Pique, Martinez, Torres, Fabregas, deGea, Mata, Xavi Alonso, Costa, Carzola, Silva, Azpilicueta and Reina
That's over half their squad with experience outside Spain.
Compare that with the current England squad, with the only non-English experience being their third choice goalkeeper's couple of seasons at Celtic.
Clearly when you have a strong league you will have plenty of players playing in that league, but in recent times all the most successful teams internationally have brought significant experience of playing in top leagues outside of their home country to their international squads.
And if you look back you can see the problem:
So these are the number of players in the squad with any experience outside of England. Then I've indicated whether that experience is in another top league (Spain, Italy, Germany, France). Then I've indicated the number of players with non-English experience who actually played:
2016 Euros - 1, 0, 0 (Forster) – last 16
2014 World Cup - 1, 0, 0 (Forster) – out at group stage
2012 Euros - 0, 0, 0 – quarter final
2010 World Cup - 0, 0, 0 – last 16
2006 World Cup - 2, 2, 2 (Beckham, Hargreaves) – quarter final
2004 Euros - 2, 2, 2 (Beckham, Hargreaves) – quarter final
2002 World Cup - 1, 1, 1 (Hargreaves) – quarter final
2000 Euros - 1, 1, 1 (McManaman) – group stage
1998 World Cup - 0, 0, 0 – last 16
1996 Euros - 3, 3, 3 (Ince, Gascoine, Platt) – semi final
1992 Euros – 4, 3, 4 (Woods, Steven, Platt, Lineker)- last 8 (were only 8 teams)
1990 World Cup – 7, 3, 6 (Stevens, Butcher, Waddle, Beardsley, Lineker, Woods, Steven) – semi final
Make of that what you will