Amusing German anecdote: my German son went from German school in California (English was taught by native-speaking, non-german-speaking teachers with a California teaching license, and of course spoken outside school) to Germany (English was taught by a native English speaker who spoke no German (moved with her husband to Germany)). What subjects was he behind in when he arrived? English.
Coincidentally his English teacher his last year in California and when he got to Germany were both Australian.
All that being said, outside big cities I haven't really encountered anyone in Germany with strong English.
Sure, and not all are subsidized by the German government. Just as there are French, Japanese, even Swedish schools in various countries all over the world. There are "international" (English as language of instruction, sometimes foreign funded) schools and universities around the world too.
Some are used by business people moved over for a couple of years concerned that their kids won't be able to pass the exams etc if they get out of the "home" system (though I figure if you're only visiting for a couple of years why not sample the local system..though in California that's pretty dire). The other reason is the opposite: the kids are integrated to be able to do things like little league or whatever but need to get some "home" education so they'll be able to move back.
If you live in Palo Alto there are even two German ones close by: one just across the north border in Menlo Park and one immediately south in Mountain View.
Coincidentally his English teacher his last year in California and when he got to Germany were both Australian.
All that being said, outside big cities I haven't really encountered anyone in Germany with strong English.