This is what a more fair comparison looks like. https://i.imgur.com/wAqSvrV.png
1) There's plenty of room for editing
2) The UX at the top is about 25% taller because everything (fonts, icons) is scaled to be about 25% larger in each dimension for readability since people have bigger screens now.
And so actually, usable area has actually increased as a proportion of average consumer screen height.
The original Twitter post is just a silly unfair comparison.
And the issue isn't the content margins, it's the UI. There's no reason to have a paste button 3-4x the size of other buttons, for example.
When Microsoft created the ribbon layout, this was the tail-end of when they were still doing lots of user-research, by putting real users in labs and observing how well they did at common tasks.
So I believe them that having a paste button 3-4x bigger than the size of the other buttons is actually better for the majority of the users.
These days UIs are just all defined by the designer or developers personal preference, without any actual user testing ("personally I just use command-V, why would you even NEED a paste button??!!", "lets make all these icons tiny and gray and obscure because it looks cleaner!!")