The problem with Google is not that they control their own search algo, that's silly. The problem with Google is that they have (or are approaching) monopoly status. That's against US antitrust laws already. No need to make new laws or create new agencies, just enforce what's already on the books.
Giving the government control of search algos is a terrible idea. That just moves the locus of control of the market from one place to another. What you want the governement to do is ensure competition in the market, so that there is no centralized locus of control.