The current TOS clearly states that they do not sell user data. Until that TOS is changed they have no right to sell their user data to advertisers. Once it does change, which I'm sure will be soon, the question will be whether or not they have the right to sell user data that was collected before the TOS was changed.
I think there's definitely a need for more privacy options, but I have doubts that the FTC or any federal agency really understands the issue well enough to be anything more than a hindrance to making it happen.